About unexpected price drops, I have not talked to much about it but it seems to me that no matter what type of system one uses one should have a stop loss order in place.
Or simply, as one part of a larger portfolio, set a max # of $ you're willing to commit to a single position. Once you've invested that much in it, then that's the maximum you can lose. If you're conservative, say no more than 2% of the portfolio to any one position. That way you can't lose more than 2%. This in a case of an Enron or some such. Otherwise, if it just "sits there" for a while on the bottom, unless you really need the money, there's no urgency in having to sell it - wait until it comes back up. Would likely be a long-term gain then anyway. Besides trading systems, cash management is an equally, if not more important aspect that somehow or other seems to get less attention than it deserves..
Best,
AIMster
News 
Market Data 
Discover 
AI
