Stop loss in Nasdaq 100

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Stop loss in Nasdaq 1002018-12-18T12:43:49+00:00
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  • StefanM
    Participant
    Post count: 29

    Hi all

    I have seen the debate regarding the use of stop-losses and the conclusion, for ETFs, being that they reduce performance.

    When looking at individual stocks in the Nasdaq 100 strategy, would a stop loss improve performance?

    Thanks

  • Frank Grossmann
    Moderator
    Post count: 174

    It may help in case of a black Swan event for the whole market or for a single company. But you should set the stop loss limit quite far away from the actual price. I would recommend at least 10% as many of the stocks selected by the “leader” sub-strategy have been very volatile and even a 10% stop loss would have sold many stocks which would have recovered only days later.

  • StefanM
    Participant
    Post count: 29

    Thank you Frank.
    Logic would suggest that a 10% stop loss would have avoided Nasdaq100’s maximum drawdown of 30%.
    Is there a way in QT514 to apply a stop loss to the substrategies to test the theory?
    Thanks

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