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Financial Risk Manager Part 1

Financial Risk Manager Part 1

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Assume you have a long position in a stock with a current market price of 35.Youhavetwogoals.First,toretainownershipaslongasthestockcontinuestogoup.Second,toexitthepositioncompletelyifthestockdropsbelow35. You have two goals. First, to retain ownership as long as the stock continues to go up. Second, to exit the position completely if the stock drops below 35.Youhavetwogoals.First,toretainownershipaslongasthestockcontinuestogoup.Second,toexitthepositioncompletelyifthestockdropsbelow30. Which order best meets your dual objectives?

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