Stop Loss Strategy VS Buy & Hold? (11 year study)

There is a difference between a trader and an investor

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Please make more acedemic based research video

I love your videos. Please make more video on what academic research say about various subject on equity

I'm incredibly moved by this material. A book that covered these topics was a key driver in my life's transformation. "Mastering Money Mindfulness" by Benjamin Hawk

I wonder if they put buy orders instead of stop losses to lower their average would affect success rate 😉 don't sell bottoms newbies.

Great content!

Suppose I bought split adjusted TSLA at $2 in 2014 and used a trailing Stop Loss of 20% I would have been stopped out more than 50 times each time losing 20% of my capital.

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Ty

If stop loss is better then why warren Buffet dosnt use it?

I realize the time period of the study (1998 to 2009) was not cherry-picked, but it included two of the largest draw-downs in history, with no long periods of trendless trading. That would greatly favor a stop loss system. They couldn't have picked a better "arbitrary" time period.

buy and hold investor does not sell in 2 years , he waits for 10 ,15 20 years

Why would you wait for a 20% downtrend loss when you can get out with a 10% loss and then buy back at discount in at the eventual rebound?

Though I did not lose any money in the market since I have been just doing simulation and demo Trading, I started watching the wrong Guru that was using the buy and hold strategy as their platform of trading. Boy did that held me back for months, had I watched this video first and started practicing the strategies I probably would have been making money in the market right now. The buy and hold strategy is the worst and stop me from really trading for real since my simulated losses kept coming because of it.

Thank You

great video

Great Video, Just a question, Is there any specific criteria to select the stocks. Are they trending/sideways etc

The stop loss strategy doesnt work!

I wonder what the results would be when using an ATR instead of a trailing percentage?

So you trade with only one take profit ? Is it good ?

I don't agree with this at all. Maybe good for brokers and the industry. I think buy and hold is amazing if the selection is solid blue chip dividend paying stocks heavily. diversifies over sector.. I do not want to offend you, just saying this because this is misleading to beginners and new investors.

Really lovely content

Do you analyse why when you claim it's easy 95% of traders lose money

People who annualize returns off one trade are insane

Simply Stop Loss allows/encourages more risky purchases. The greater evaluation mental cycle gets a person to the point of purchase/investment. On the 2020 Post March 23rd crash I knew it was a Fire Sale for the biggest names in the market. So had a great run until late May where I wanted to keep my 30% profits so I entered a conservative 5.6% Stop Loss, On June 10th all my stops executed, so collectively on 8 Fire Sale investments I lost 5.6%each that's over 40% of 30%. By Mid June 6/8 ran again and surpassed where I was stopped and continued to another 20%. So it would seem set a stop after you have gained 5% then set a stop at 5.5% then 10.1 and then sit back

Hi, I am new to trading, I think your videos are awesome, I am learning so much from them.
Thank you very much.
I have a question, when you talk about my stop loss should be 20% of the amount of money I am trading?
Sorry for the question.

what % below entry price are good to place a stop loss ?

Just stumbled over your channel and after a few videos I‘m a fan already. Very solid and professional content that let‘s viewers take steps to get better in their investing or trading results. Thank you!

I don't know about stop-loss settings based on PERCENTAGES. The late Dr Van K Tharp -- a trading psychologist about whom you've done a couple of videos -- recommended basing them on AVERAGE TRUE RANGE (ATR). He suggested stop losses of 3 ATRs, with the idea that if an instrument moved that much against you, it was probably time to get out of it.

Excellent video. I wonder if it is possible to factor in drawdowns in such a study as they impact psychology and the traders ability to follow their rules consistently.

I think stop loss results also depends on the stock selection and the timing. We can't just rely on the stop loss on an overall basis....

Stop percentage depends upon time frame also

what this does not put into account is the exponential growth of wealth of the most wealthy players.

Your vdo are fun to learn. Thank you so much

This could likely justify doing a study on the Trailing-Traditional percent range between 15% and 25%, somewhere between 17-23% might be even better.

Great video but confused as earlier in video a 15% trailing stop was best at over 70% returns, yet at end was second to 20% trailing stop at around 20% returns?

When it comes to wealth creation, what advice would you give to someone who has $10k above and is ready to invest but in search of a productive sector that can yield good returns ?

Could I make a video request? You've made a lot of great videos about topics related to risk management, trading strategy, psychology, position sizing and other aspects relating to the trading process. Would it be possible to make a video about asset selection and the research process to finding/choosing your investments? This is the part I'm struggling with right now. There are so many options out there, it feels overwhelming and it would be great to have some ideas on where to start or how to narrow things down. Thanks again for the great content!

You are the best I've ever seen at teaching, i try and be the idiot in the room, always ask questions until It's thoroughly understood, regardless of how I may look from it, I don't have to ask questions with your videos. I get it first time. If I could buy you a pint I would :)

Eye opening video. It's really helpful to cut away all the noise from various opinions and see scientifically-supported examples of what's optimal. Definitely feel like I need to be a little more active in managing this stuff (or else intentionally pick investments that do not require management)

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❤💛💚💙 The study you used is one of the worst cherry picked data of all time. First, it starts in 1998 (top of Tech bubble) and then it ends in 2009 April (bottom of GFC).
And then it only does Stockholm Index...
The S&P500 buy & hold has destroyed 98% of fund managers for past 13yrs..
Ive been daytrading since 2011 for full time so I do participate , but this data being cherry picked is disingenous.
S&P500 is the King (USA) , the rest of stock market indexes suck balls.. btw Ive been holding Bitcoin & Ethereum since 2018 , aint nobody outrading that

May I ask you cause something is confusing me......I trade bitcoin/usd in leverage/futures trading with 10x - Now I see the video and you said trailing stop loss of 15% to 20% - that would be very very far and will actually cause lots of loss on my part. Lets do some math.

If I want to go long (buy into bitcoin a long position) with 100 USD and 10x leverage.

The position size will be = 1000 USD
lets assume entry price of 23700 btcusd
now to make a stop loss of 10% that means the stop loss is at the price of 21330
which makes me lose -99.54 from my initial investment of 100 USD which means I'm almost liquidated.

I usually go with 1% to 2% as expectancy of loss from my whole portfolio (Not position size) which for my portfolio the 1% to 2% -- I don't know how to make out with the thing you showed in the video to have 15% to 20% -- can you help me on this? maybe I am confused with something.

But if I set my stop loss at 20 to 25 percentage loss, doesn't my gains have to be so much larger to break even?

it doesnt work for blue chips. If i had done this for my macdonalds or unp stock that i hold for retirement, i woulda lost these positions and had to come back at higher prices.

I learn (and apply) so much from this channel. I am so grateful. Thank you!

I dont understand why wait until the next quarter.

How about a trailing percent stop loss and turf you want for it to go up by a similar percentage of she the stop loss would be.

So if you put in 10% stop loss, you get it once it goes up 10% from the low.

Best channel on stock market.