Use of Stop Loss triggers?23 May 2020 11:09
Yesterday's early plummet in the SP of VLS, followed by its rapid rebound and significant daily gain put me in mind of my first dabble with the stock market.
Back in 2011/12 I invested in Cable & Wireless Worldwide at a bargain basement price as a turnaround / takeover opportunity. C&WW was eventually acquired by Vodafone, and in amongst the melee I got caught out by my stop loss in a similar scenario as VLS yesterday (sudden drop, immediate yoyo rise) and missed out on a few £k (a mega amount of money to me, especially back then!).
Ever since, I have avoided using stop loss triggers. I still carry the C&WW scar. I am sure a fellow VLS shareholder somewhere fell victim to theirs yesterday. I guess the flipside of not using them is the fact that I still own shares in VLS I bought at ~10x the current SP!
So, I am just wondering if anybody would be kind enough to share their view on stop loss triggers, and when they use them if at all? Whilst I have no doubt they can be a valuable tool, they can certainly be dangerous! I am wondering if I am missing out on striking a safe(ish) balance, so the experience of others would be interesting please.
Thank you! GLA! :-)