If you have $60,000 in stock market capital, then that would mean the maximum loss you would accept on any one trade is $1,200. If you risked $6,000 by buying 600 shares of a $10 stock, then you would limit your risk to no more than $1,200. In that case you would set your stop loss at $8 and would have $4,800 left if you exited the position at the maximum loss allowed.
Good discussion. I would point out your math errors in the above paragraph howevever... If you sold the $10 stock at $8, then it is a 20% loss, not a 2% loss. if you risked "$6000" by "buying 600 shares at $10 stock", then a loss of $1200 is 20%. you would have to risk $60,000 by buying 6000 shares of a $10 stock. You alluded to this earlier, but didn't carry it through.
I have been a strong observer of Investors Business Daily and O'Neill's strategies for years and I usually set my stop loss orders in at ~8% if I set them at all.