Stop loss and target price

Hi John,

Firstly, thanks for the kind words and we love receiving ideas on how to improve the MM service, we’re constantly looking at ways to get better outside of finding a crystal ball.

Our portfolio decisions come about through a combination of fundamental and quantitative assessment, which means an arbitrary stop loss/ profit target would go against that approach. From experience, having such levels in place are more relevant for technical/mechanical based trading strategies, that have very clearly defined entry/exit rules based on price action.

While there are examples of stocks we own where a stop-loss would have conserved capital, our data shows that over time, having these in place would reduce the overall performance of the strategies. The key message being, that positions taken due to price action, should be exited due to price action (i.e. stops of targets), however a position taken for other reasons should not be beholden to simply price.

We do often discuss targets for stocks, though these are not denoted in the portfolios. The only variance to this is in our new section titled  “Shawn’s Trading Ideas“, where stop losses are provided and amended over time, and covered in reports.

We do send alerts in real-time when we are amending portfolios, which we know members appreciate.  Sorry, not the answer you were hoping for John.