You have to determine how far you want to let the market go against your position before getting out. Be it $2, $1, $0.5 etc. It depends on your style, time frame. Important point is, after you decide the rules for managing the trades, do not(!) change them after few trades or so.
Traded more NYSE stuff with stops... they work fine and that makes trading fun again. Slippage is usually $0.01 to $0.10, on stuff trading 2m shares/day and up... which is great. NASDAQ sux.
Has anybody been using stops for Nasdaq issues lately? Are they working now ?? I have been doing strictly NYSE trading just because of this issue. Any updates ?
I just got my account funded, so I was experimenting with stops. On thursday I bought a couple hundred shares of CORV in the 6.9's. I placed stops at 6.84 and 6.79. The stock ask price was below both my stop levels for a period of time and my trade was not triggered (ECN's were on the bid and ask below my stop level, not that it matters) Later in the day a report was returned that one of my trades was executed at 6.78. The other one was not executed. I felt like I needed to wait until the next day to sell the other hundred so I would be sure I was not short. So I guess their stops are not working yet.
When using "best execution", I've never had a stop blown through or ignored. BUT I always get lousy stop activation when trading Nasdaq. Everytime single time I am watching, the stop is activated a good minute or so AFTER the ASK price matches my stop. I've simply NEVER gotten filled on a Nasdaq stop at a reasonable price. What I do now is purposely set my stop above where I would normally set it, in two stages. So say I want a stop at 50.00. First, I figure the BID/ASK spread is about 2 or 3 cents. So I make it 5 just to be sure. So the stop is 50.05 at this point. Second, I know that because IBs stop election software sucks, my stop will really get activated at 49.97 or something in that area. So I set the stop at 50.13. This way, after the stop takes its minute and a half, and I get my lousy fill, it will be in the ballpark area of what I was looking for in the first place, which was around 50. In short, IB has a real problem with Nasdaq stops. NYSE are fine. Wet