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Stop Orders and Profit Targets: 5 Ways to Stop Gifting Money to the Markets (Part 3)
The greater the risk, the greater the reward – so the theory goes. Investments that involve little risk typically offer small rewards. And high-risk trades can yield windfall profits. In trading, risks and rewards define each position. The ratio can be tweaked using tools like stop-losses and profit targets. That’s what Part 3 of our series on Not Gifting Money to the Markets is all about. Money in a savings account is typically viewed as low risk, but then there is little return potential. On the other hand, buying shares of a low-priced biotechnology company could potentially result in 100% loss of one’s ... (full story)