Mental stops can spare you some unnecessary losses, but they also require experience and attentiveness to the markets. If you have a day job, opt for the peace of mind that hard stops provide -- just keep them from being too close to your support levels.
While stop losses will likely continue to elicit impassioned opinions from investors for the foreseeable future, knowing the specifics on implementing stops can help limit your risk, lock in your gains, and take some of the emotional impact out of your next trade. Next week, we'll add to your technical repertoire with another primer that will bring you closer to implementing technical analysis for your portfolio.
In the mean time, do you have a burning technical analysis question? Get it answered by heading to Stockpickr Answers.
-- Written by Jonas Elmerraji in Baltimore.
Twitter and become a fan on Facebook. Jonas Elmerraji, based out of Baltimore, is the editor and portfolio manager of the Rhino Stock Report, a free investment advisory that returned 15% in 2008. He is a contributor to numerous financial outlets, including Forbes and Investopedia , and has been featured in Investor's Business Daily , in Consumer's Digest and on MSNBC.com.