Stock question. Should I set a stop loss at $4.00? Purchase price = $2.08, high = $7.24, now sitting at $4.03.

Question

Stock question. Should I set a stop loss at $4.00? Purchase price = $2.08, high = $7.24, now sitting at $4.03.

Answer 1

If it's $4.03 now and you set a stop now at $4.00, if there is the slightest whiff of volatility, you are essentially selling the stock real darn soon.  

If you had set a trailing 7% stop when you bought it, you'd have made over 200% gain (stopped out at 6.73).  Minus commisions of course.

(This is not to say that I always use stops, but if you are going to, do them sensibly.)