Is it possible to change and put a stop-loss after buying shares? It is a very pertinent question that beginners and inexperienced traders often ask. Let’s see if it is possible or not.
A stop-loss order is a tool that enables traders to control their risk. It triggers to buy or sell orders when the price reaches a predefined level. Stop-loss order is a remarkable tool to avoid unexpected losses as well as locking profits. Is it important to place stop-loss orders? Yes, it is very important to use stop-loss orders in order to avoid huge losses. You need to limit your losses in case of a trade going your way. And for that, you need a stop-loss order. Similarly, if you want to lock your profit, stop-loss orders serve you.
Furthermore, proper risk management is the key to successful trading. For risk management, a stop-loss order is one of the most effective tools. However, the key is to use it properly. Fortunately, stop-loss orders don’t cost a penny. If we look at the emotional side, stop-loss also empowers you to avoid making emotional decisions. Finally, you don’t need to sit in front of the screen to close your position to prevent sudden unfavorable price movement. Simply put, stop-loss orders offer numerous advantages and cost you nothing. So, never think about trading without stop-loss orders in place.
So, that is the importance of stop-loss orders but is it possible to change and put a stop-loss after buying shares?
Yes, it is possible to change and put a stop-loss after buying shares. In fact, you can change and put a stop-loss anytime or whenever you want after entering your position. For example, you place stop-loss orders at $95 after buying shares at a price of $100 per share. Now, if the price moves in your favorable direction, you can change and put a stop-loss order wherever and whenever you want. Let’s suppose that price moves to $110 and you want to move your stop-loss to $100. So, you can simply cancel the previous one and move the stop-loss to $100.
Additionally, you can also place several stop-loss orders. For example, you want to sell a few shares when the price reaches $95. You can simply adjust the number of shares you want to sell to $100. That means you can keep shares in your portfolio instead of selling all of them when the price touches the $100 limit. Moreover, most trading platforms don’t cancel stop-loss orders at the end of the day. However, some platforms may cancel stop-loss orders if the price doesn’t trigger them until the end of the day. So, you have to set a stop-loss again.
So, it is quite obvious that you can change and put a stop-loss after buying shares. The use of this remarkable tool is so simple. Anyone with a basic knowledge of the trading platform can easily set or reset stop-loss orders. Additionally, stop-loss orders don’t cost you a penny. Therefore, it is very important to capitalize on this remarkable tool and prevent huge losses or book any additional profit.