The New York Stock Exchange recently announced that it will no longer accept stop orders (including stop-loss and stop limit orders) beginning February 26, 2016. That’s on the heels of similar announcements from NASDAQ and BATS.
That means that the three of the biggest exchanges in the country now no longer allow investors to place stop orders on their trades.
While some brokerage houses are likely to keep them intact to attract retail investors, they will be executed internally rather than on the major exchanges.
Stops were designed to help investors limit their downside risk and protect their profits. They allowed investors to go about their lives with a failsafe in place in the event they were not in front of their trading screens to manage their positions – which, for individual investors like you, is most of the time.
So what are you – the average retail investor – to do? How are you supposed to protect your capital and your profits? Let me offer you a few considerations that will help you (and the capital in your account) survive this move by the major exchanges.
Let’s get started… Continue reading…