Sell-stop adjustments are made initially to reduce and/or eliminate the Risk
Corridor, then ultimately to lock-in profits of a Long position.
Note in this example with WLP how we were able to virtually eliminate our
risk as a result of seven different Sell-stop adjustments during the months of
May through August. Our ultimate loss on this position was 1.2%:
Note in this example with BARZ how we made eight different Sell-stop
adjustments during the months of June through October. As the price of the stock
began to drift in late November we locked-in the profits when the Sell-stop violations
occurred allowing us to realize a nice 14.5% overall gain:
