A stop-loss order is a specific direction you give a broker to buy or sell a stock if it hits a specific price. A stop loss order is used to protect a profit or limit a loss on an investment.
For example: If you own a $12 stock, you might tell your broker to sell it “on stop” if it hits $10. This may limit your losses if you paid more than $10. If you paid less, it may preserve some of your profits. Some investors set up up stop-loss orders as a safety net for their investments. Note, however, that you will pay a commission for each buy or sell automatically triggered.
At times, mechanical investing aids like stops can work. But most investors who rely on them wind up losing money in the long run. That’s why we’ve long recommended that investors avoid using stop-loss orders with their stock brokerage firms, especially on any sort of habitual basis.
With speculative stocks, it might be better to use a stop-loss order than to buy the stocks and then forget about them. You can get away with the “buy-and-forget-it” approach for a time, if you buy high-quality stocks. But few speculatives ever reach that degree of investment quality.
Still, we think overall, for the best long-term gains, you should use our three-part Successful Investor philosophy:
If you’re like many investors, recent market volatility has made you more sensitive to risk. Discover how to make the most of your stock investments in this free special report, Stock Market Investing Strategy: Pat McKeough’s Conservative Investing Guide for Making Money & Cutting Risk
With all the TSX ETF investments available, it’s not too difficult to diversify your portfolio. Here’s how.
There are hundreds of ETF opportunities on the Toronto Stock Exchange (TSX) sponsored by investment managers like BlackRock Inc., BMO Asset Management and Horizons ETFs Management. The best TSX… Read More
You will have better opportunities for success with ETF investing when you follow our tips
In 1990, ETF investing was introduced in Canada. The fund was called Toronto Index Participation Shares, and started trading on the Toronto Stock Exchange (TSX). The shares, which tracked the TSE… Read More
When picking the top Canadian ETFs two of the keys are low management fees and following a “traditional” approach to tracking indexes
The top Canadian ETFs generally practice “passive” fund management, in contrast to the “active” management that conventional mutual funds provide at much higher costs… Read More
Investors interested in building the best ETF portfolio need to look at traditional ETFs focused on top-quality stocks
Investors use ETFs in a variety of ways. To build the best ETF portfolio, you should know both the advantages they offer, and some potential drawbacks.
Diversification is one… Read More
Investing in aggressive growth funds can be profitable for ETF investors who understand the risks.
It’s hard to come up with a short, definite answer when talking about our philosophy on aggressive growth funds. Partly that’s because a great deal depends… Read More
Many investors consider using a stop-loss order to protect their profits, particularly if the market begins to slide down after a period of gains.
A stop-loss order is a specific direction you give a broker to buy or sell a stock if it hits a.. Read More
Even when stock markets are in an upward trend, they are still subject to sharp setbacks, such as the one triggered by the re-election of Barack Obama as president last week. Many investors seek to protect their profits against such reverses though the use of… Read More
As stock markets have pulled back from their recent highs, you may have wondered about using stop-loss orders to protect your profits.
However, before you try this approach, you should keep in mind that stop-loss orders have a number of risks that can cost you… Read More
On Thursday, May 6, 2010, the Dow Jones Industrial Average opened at around 10,860. Later that afternoon, it suddenly fell 9.2%, to 9,869.62. In the space of just a few minutes, it had recovered most of these losses, and closed at 10,520.32. It’s now back… Read More
Stop-loss orders are a stock trading strategy investors use to sell a stock if it falls to a specific price.
For example, if you own a $12 stock, you might tell your broker to sell it “on stop” if it hits $10. This may limit… Read More
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We are continuously in the process of improving our sites and services. If any new features or policies require a change to this current policy, we will post a clear notice of this change on pages of our site where the privacy policy appears. The principle behind this privacy policy is to collect information with your knowledge and consent.
What personal information do we collect?
The information we receive from customers helps us personalize and continually improve your online experience at TSI Network. TSI Network may collect personal information online for all legal purposes, which include, but are not limited to:
Information You Give Us: We receive and store any information you enter on our website or give us in any other way through sign-up forms or ordering forms for publications and services. You can choose not to provide certain information, but then you might not be able to take advantage of many of our services and features. We use the information that you provide for such purposes as responding to your requests, customizing your web browsing experience for you, improving our website, and communicating with you.
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We do reserve the right, however, to collect and perform statistical analyses of the internet traffic to our website for our internal use. However, information collected does not allow us to identify any individual, and will not collect any personal information of the visitor. Furthermore, we do not sell, rent or loan to any outside parties the information collected and analyzed.
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Does TSI Network Use the Information It Receives?
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TSI Network does everything possible to prevent unauthorized intrusion to its websites and the alteration, acquisition or misuse of personal information by unauthorized persons. Notably passwords submitted by users of our websites are encrypted using encryption mechanisms. However, TSI Network cautions visitors to its websites that no network, including the Internet, is entirely secure. Accordingly, we cannot be responsible for loss, corruption or unauthorized acquisition of personal information provided to our websites, or for any damages resulting from such loss, corruption or unauthorized acquisition.
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TSI Network has procedures in place to keep your personal information accurate, complete and current for the purposes for which it is collected and used. You may review the information that you have provided to us and where appropriate you may request that it be corrected. If you wish to review your personal information please send a request to: service@tsinetwork.ca.
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Changes to this Policy
This Policy is the sole authorized statement of TSI Network's practices with respect to the collection of personal information through TSI Network's websites and the subsequent use and disclosure of such information. Any summaries of this Policy generated by third party software or otherwise (for example, in connection with the "Platform for Privacy Preferences" or "P3P") shall have no legal effect, are in no way binding upon TSI Network, shall not be relied upon in substitute for this Policy, and neither supersede nor modify this Policy.
TSI Network may revise this Policy from time to time.
Legal Notices and Disclaimers
The contents of this web site and our publications are based upon sources of information believed to be reliable, but no warranty or representation, expressed or implied, is given as to their accuracy or completeness. Any opinion reflects the Successful Investor’s judgment at the date of publication and neither the Successful Investor, nor any of its affiliated companies, nor any of their officers, directors or employees, accepts any responsibility in respect of the information or recommendations contained in the publications or on this web site. Moreover, the information or recommendations are subject to change without notice.
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