This is great stuff. Thanks David for putting all this together!
One thing I am curious about is setting stops using volatility of each individual stock as a factor to widen or narrow the actual trailing stop percent (using something like 2 x ATR to approximate) so as to reduce getting stopped out?
A lot of the Top 10 names seem to be much more volatile than the general stock market. On the downside this would make entry more complicated and potentially means setting the stop so wide that bigger losses happen if things go way down...
Thanks, Zach. Re the basic strategy, I used 20% as a rule of thumb, but you can experiment with narrower or wider stops if you like. I will tell you that my biggest gain from buying a top ten name came from me forgetting to put a stop on it: IREN. I got it at $11 or $12 or something like that last year, and it dropped to ~$6 during last spring's bear market, and I figured it had dropped so much I'd just hold it--and then it exploded higher from there. Obviously, that's not going to happen with all the top names.
This is great stuff. Thanks David for putting all this together!
One thing I am curious about is setting stops using volatility of each individual stock as a factor to widen or narrow the actual trailing stop percent (using something like 2 x ATR to approximate) so as to reduce getting stopped out?
A lot of the Top 10 names seem to be much more volatile than the general stock market. On the downside this would make entry more complicated and potentially means setting the stop so wide that bigger losses happen if things go way down...
Thanks, Zach. Re the basic strategy, I used 20% as a rule of thumb, but you can experiment with narrower or wider stops if you like. I will tell you that my biggest gain from buying a top ten name came from me forgetting to put a stop on it: IREN. I got it at $11 or $12 or something like that last year, and it dropped to ~$6 during last spring's bear market, and I figured it had dropped so much I'd just hold it--and then it exploded higher from there. Obviously, that's not going to happen with all the top names.