Cryptocurrency Q&A
Is 5% a good stop-loss?
Is 5% a good stop-loss?
Giuseppe
Thu Oct 10 2024
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6 answers
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I'm considering setting a stop-loss for my investment, and I'm wondering if 5% is a good threshold. I want to know if this percentage is commonly used by investors as a strategy to minimize losses.
6 answers
CryptoLodestar
Sat Oct 12 2024
Active traders, who frequently buy and sell assets, often opt for a stricter risk threshold, such as a 5% stop-loss level. This helps them limit their losses and maintain their trading capital.
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Andrea
Sat Oct 12 2024
On the other hand, long-term investors, who hold onto their assets for extended periods, might choose a higher stop-loss percentage, such as 15% or more. This approach allows them to ride out market fluctuations and focus on the long-term growth potential of their investments.
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CryptoBaroness
Sat Oct 12 2024
It's important to remember that once a stop price is reached, the stop order automatically turns into a market order. This means that the asset will be sold at the best available price in the market at that moment.
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JejuSunshine
Sat Oct 12 2024
Risk management is a crucial aspect of trading, whether it's for active traders or long-term investors.
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SkyWalkerEcho
Sat Oct 12 2024
Consequently, the actual selling price may vary significantly from the original stop price, depending on market conditions and liquidity.
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