A couple of newbie questions regarding orders.

[Stocktrading101]

Originally Posted by Dee-eight

I also moved up a spot or two in the Falkin neverending comp This is getting to be more fun all the time!

Dave, I will make sure to watch out for you! Actually, I am in a bad spot after Google posted those bad earnings... Hmm... Well, watch out for me then .
Great to have you on board; have a great weekend!

Blain

[Dee-eight]

Yay! I've locked in a (tiny) profit in NFLX as of today. The trailing stop is my new best friend!

[gijoe9]

Originally Posted by Dee-eight

Yay! I've locked in a (tiny) profit in NFLX as of today. The trailing stop is my new best friend!

You my friend are awsome just thought I should let you know

[Dee-eight]

Originally Posted by gijoe9

You my friend are awsome just thought I should let you know

Thanks, Joe. Flattery will get you a beer on me if you're ever in the neighborhood.

I just got off work, and am relaxing a bit before I go to the sim to check my stops and move them up as advances warrant.

Edit: added a tiny bit more profit to NFLX and moved stops up in four other positions.

Edit again: I got the idea to check out NFLX after reading a thread in a different forum about bad behavior of the general public in movie theatres. One line that stuck in my mind was "Why the heck should I spend 12 bux to go to the movies and put up with that crap when Netflix is so much cheaper?"

[Dee-eight]

PSS hit the trailing stop and I exited the position with a modest profit. I suspect that in my enthusiasm to lock in a profit, I may have set the stop too tight and exited a bit early.

I've been setting stops at 8% on new positions, and tightening them to 7% whenever a position rises to 4% above my book, and then tightening again to 6% on any rise above 7%. This locks in the profit, but increases the danger of exiting early, as in the PSS example above.

Should I stay with 8% across the board, do you suppose? I'm thinking that any profit is good profit, and that decisions on setting stops should be on a case by case basis. Any input on my strategy as outlined above is most welcome.

[Dee-eight]

New question: If I enter a short position and want to set stoploss and profit taking points, which type of order do I use for each? Limit for stoploss? Stop for profit taking? I'd hate to use the wrong order type and accidentally exit the position just minutes after I entered.

[gijoe9]

Buy-to-Cover Limit
An order to cover a short position in your portfolio by repurchasing shares, but only once a specified price, or better, has been reached. This order can be entered to set up an automatic cover of your short position once a stock’s price has fallen to your target covering price. A buy-to-cover limit is useful if you have a target price in mind but are unable to frequently monitor your portfolio.

Buy-to-Cover Stop
Similar to a sell-stop order, this order type will exit your position automatically once a specified loss level is reached. In a buy-to-cover stop order, you specify a maximum price that, when reached, triggers a covering purchase of your shorted shares. Remember: in a short sale trade, the higher the price moves after your short sale, the greater your losses.

Buy to cover Stop is above the the short sell price and buy to cover limit is below the short sell price.
example: you sell short at $100 you set the buy to cover stop at 110 or 10% loss the buy to cover limit is set at 70 for a gain of 30% if either stop or loss is triggered you gain or lose that %. Hope this helps
Joe

[Dee-eight]

Thanks, Joe. You know I shorted KMP just for the practice, and it's one of the few bulls in my herd of bears at the moment