Umeå University's logo

umu.sePublications
Change search
CiteExportLink to record
Permanent link

Direct link
Cite
Citation style
  • apa
  • ieee
  • vancouver
  • Other style
More styles
Language
  • de-DE
  • en-GB
  • en-US
  • fi-FI
  • nn-NO
  • nn-NB
  • sv-SE
  • Other locale
More languages
Output format
  • html
  • text
  • asciidoc
  • rtf
Optimal Leverage and Stopping Losses in Trading
Swedish Pensions Agency, Stockholm, Sweden.ORCID iD: 0000-0001-9263-063X
2020 (English)In: IFTA Journal, ISSN 2409-0271, no 20, p. 42-49Article in journal (Refereed) Published
Abstract [en]

Traders may use leverage to scale up the returns and use stop orders to limit their losses. Typically used for controlling risk, stop loss orders may actually increase long-run trading profit. This paper derives a criterion for maximizing long-run trading profit with respect to leverage and stop loss order placement, as both may affect profitability. In a trading application, we study how stopping losses and leverage affects trading profit. We find empirical support that stop loss order placement together with leverage can have a substantial effect on long-run profit.

Place, publisher, year, edition, pages
Rockville, MD, USA: The International Federation of Technical Analysts , 2020. no 20, p. 42-49
National Category
Economics
Research subject
Economics
Identifiers
URN: urn:nbn:se:umu:diva-170748OAI: oai:DiVA.org:umu-170748DiVA, id: diva2:1430243
Available from: 2020-05-14 Created: 2020-05-14 Last updated: 2021-01-25Bibliographically approved

Open Access in DiVA

No full text in DiVA

Other links

URL

Authority records

Lundström, Christian

Search in DiVA

By author/editor
Lundström, Christian
Economics

Search outside of DiVA

GoogleGoogle Scholar

urn-nbn

Altmetric score

urn-nbn
Total: 259 hits
CiteExportLink to record
Permanent link

Direct link
Cite
Citation style
  • apa
  • ieee
  • vancouver
  • Other style
More styles
Language
  • de-DE
  • en-GB
  • en-US
  • fi-FI
  • nn-NO
  • nn-NB
  • sv-SE
  • Other locale
More languages
Output format
  • html
  • text
  • asciidoc
  • rtf