Key insights
- An individual investor is seeking advice on using stop-loss orders to manage overnight risk in volatile stocks like TSM. The investor is experiencing anxiety from monitoring pre-market fluctuations and wants to avoid large overnight losses. They are struggling to find a balance between protecting against significant drops and avoiding premature triggering of stop-loss orders due to minor market fluctuations. This reflects retail investor sentiment and risk aversion, but has limited impact on broader US equity markets.
I keep finding myself awake at 6:20am PST, checking overnight price fluctuations and market open. It's not doing wonders for my health. Looking out for 10%+ drops (new wars, OpenAI not meeting internal subscriber goals and tanking my TSM holdings, etc). I hate to wake up and be down by thousands.
I'm looking for tips to be able to disentangle from checking on my more volatile stocks. Possibly a stop loss before I go to sleep? Where would you set it below the current price?
I've tried within 2% drop but overnight markets, but too often a single trade will dip will trigger and I wake up with tax liabilities and missing on a couple grand that it would've appreciated that day. Does anyone have a favorite way to set it up?