#StopLossStrategies
#StopLossStrategies
Stop-loss strategies are crucial tools for managing risk in trading and investing. They involve setting a predetermined price level at which a position will be automatically closed to limit potential losses.
Common strategies include fixed percentage stops (e.g., 1% or 2% below entry), volatility-based stops (using indicators like ATR), and support/resistance level stops. Trailing stops dynamically adjust the stop price as the position moves favorably, helping to lock in profits while still providing downside protection.
Choosing the right stop-loss strategy depends on individual risk tolerance, trading style, and the specific asset being traded. Proper placement is vital to avoid premature exits due to market noise while still safeguarding capital.