Stop limit triggered but not filled. What to do?

[Krob954 0]

I started trading live last week. Been trading simulators since August. I was ready! LOL

Friday and today I lost more money than ever before because my stop limits weren’t fulfilled. Any advice on what to do differently? Here is my example:

Bought stock XYZ at 45.80.

Set loss stop at 45.60 with a limit at 45.58 ( not sure I’m using correct terminology).

So the idea is that if the price drops to 45.60, a sale is triggered and I don’t want to fill at a price below 45.58. My sale price range is 45.58-45.60.

This worked great in simulation of course.

Friday and today, what happened was the stock price fell below 45.60, below 45.58, and never filled. It just kept dropping and dropping. I didn’t know what to do so I closed the positions with losses in the thousands instead of hundreds. I figured Friday was a fluke, but same thing happened today. Other trades have filled as I expected, honoring my limits.
 

Was it just bad luck? Did the price drop so fast, there was no chance of it getting filled? Should I have a “stop market” on my trades instead of the “loss limit”, meaning at 45.60 a market order is entered. Should I have a larger range (i.e 45.50-45.60)? How do I prevent this from happening again? I thought the point of hard stops was to prevent this exact thing from happening.

 

Thanks.

 

[TommyK667 10]

I would suggest using Stop Market, to prevent exactly what happened to you.

I would only use stop limit to enter into a position.

If you are using Stop Limit for a stop, in your case, you are essentially telling the system "Exit my position at that price but NOT PAST the limit price." So if it passes your limit price, you don't want to exit? That doesn't seem to make sense....remember the stock market can remain irrational way longer than you are rational.

Good luck!

PS. It sounds like you might be setting your risk amount a bit too high if you are just starting, and are able to lose hundreds (or thousand) in a matter of seconds.