|  | Should I set a stop-loss on all the recommendations? | | It is a matter of personal preference. Most exchanges allow stop-loss orders in options; however, most brokerage firms do not allow them for various reasons. Stop-loss orders are a way of attempting to limit your losses on an investment once that investment goes a certain amount in the "wrong" direction. Generally, most people who set stop-loss orders use the actual price of the investment (in this case the option price) for the "trigger" which decides when to liquidate a losing position. As always, check with your broker to see if he accepts these types of orders. Once "triggered," the stop order can be of two different types: a market order or a limit order. This is another decision for you. Again, personal preferences would rule. | | Back |
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