Entry and Exit Points: Same Entries, Three Exits, Tested on 33 Years of SPY
Michael Whitman
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Trading since 2017, full-time since 2020
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YouTube creator, 137K subscribers
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Published 2026-09-05
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Updated
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Reviewed
Entry is the price at which you open a trade and exit is where you close it. Almost all trading education is about the entry, and almost all of the difficulty is in the exit — because an entry is decided once, and an exit has to be decided again on every candle until it happens.
An entry point is the price where you open a trade; an exit point is the price where you close it. The gap between the two, less costs, is the whole result. To show how much the second choice matters, this page takes 82 real SPY entries and closes each one three different ways.
How it works
Every trade is a pair of prices. The entry is decided before anything is at risk.
If no price suits you, you simply stay out at no cost.
The exit is different in kind. Once the position is open, every new candle asks the same question again: close now, or keep holding? In the test below, a trade with a fixed target stayed open a median 56 sessions, which is 56 separate chances to change your mind.
A plan therefore names three prices before the order goes in: the entry, the stop that says the idea was wrong, and the rule for taking profit.
The distance from entry to stop is called 1R, and every result on this page is measured in R so trades of different sizes can be added up.
Entry orders: getting in
A market order takes whatever price is available now. It almost always fills, and the fill can be worse than the last price you saw.
A limit order sets the worst price you will accept. You either get that price or better, or you do not trade at all, and the moves that leave without you are often the ones you wanted.
A stop order to buy waits until price rises to a level, then becomes a market order. Breakout traders use it to enter only once a high is cleared. It is the mirror of a protective stop on the way out.
Each one trades certainty of fill against certainty of price. None of them changes what happens after you are in.
The three common exits
A fixed target
Pick a profit price before entry, usually a multiple of the stop distance, such as 2R. The arithmetic of those multiples is on the risk management page. A fixed target removes the decision during the trade. The cost is that any move beyond it happens without you.
A trailing stop
Raise the stop behind price as it climbs and never lower it. The trade ends only when price falls back to the stop, so it can follow a long run. By construction it never exits at the top: some profit is always handed back before the stop is hit.
Half and half
Close half at a fixed target and trail the rest. You bank part of the move early and keep some exposure to a larger one. It splits the strengths of the other two, and their weaknesses with them.
A worked example: SPY, June to August 2024
These are real daily SPY prices from Yahoo Finance, as traded. The arithmetic is done by hand.
The entry. On 17 June 2024 SPY closed at $547.10. The highest high of the previous 20 sessions was $544.12, set on 12 June, so the close cleared it: a breakout entry at $547.10.
The stop and R. The lowest low of the 10 sessions to 17 June was $524.96, on 4 June. R = $547.10 − $524.96 = $22.14. The fixed target sat at 2R above entry: $547.10 + $44.28 = $591.38.
The trailing exit. After each close the stop moved up to the lowest low of the last 10 sessions. By the close on 18 July that low was $550.43, set that same day. On 19 July SPY opened at $552.42 and traded down to $547.91, through the stop. Exit at $550.43: ($550.43 − $547.10) / $22.14 = +0.15R.
The highest high in the trade had been $565.16 on 16 July, so the stop handed back 0.67R of open profit.
The fixed exit. The stop stayed at $524.96 and the target at $591.38. SPY never reached the target. On 5 August 2024 it opened at $511.64, below the stop, so the fill came at the open: ($511.64 − $547.10) / $22.14 = −1.60R.
A gap through the stop costs more than 1R, which is why a stop sets a plan, not a fill price.
Half and half ends at the average of the two: (−1.60R + 0.15R) / 2 = −0.73R.
Same entry, same stop, same day. One exit made a small gain and another lost more than the planned risk.
The original data
What was tested. If the entries are held fixed, how much does the choice of exit alone change the result?
The entry rule. A close above the highest high of the previous 20 sessions. Entry = that close.
Initial stop = the lowest low of the 10 sessions up to and including the entry day. One trade at a time: a new entry is taken only after all three versions of the previous trade have closed.
The three exits, on the same entries. Fixed: stop at the initial stop, target at 2R. Trailing: stop raised after each close to the lowest low of the last 10 sessions, never lowered. Half and half: the average of the two.
A gap through a level fills at the open. No session touched both the stop and the target.
The sample. SPY daily bars from 29 January 1993 to 27 October 2026 gave 82 completed trades (first entry 8 March 1993, last 5 December 2025). A trade still open on the last bar is left out. Costs and dividends are not included.
SPY result. Over 82 trades the fixed target totaled +34.29R, an average of +0.42R. The trailing stop totaled −0.66R, an average of −0.01R. Half and half totaled +16.82R. QQQ’s 78 breakout trades averaged +0.46R with the fixed target, +0.16R with the trailing stop and +0.31R half and half.
What the exits did to the shape. The fixed target reached 2R on 39 of 82 trades and was stopped on the other 43, five of them through a gap.
The trailing stop ended above entry on 31 of 82 and its best trade was +2.17R.
Trades lasted a median 56 sessions with the target and 14 with the trailing stop, which gave back a median 0.61R from the highest high.
Is the gap real? Trade by trade, fixed minus trailing averaged +0.43R with a standard error of 0.15R, about three standard errors on SPY. On QQQ (78 trades from 1999) it was +0.30R with a standard error of 0.15R, about two.
The entry did not stand out. The same exits applied to an entry at every SPY close averaged +0.25R (fixed) and +0.09R (trailing) across 8,290 entries. The breakout figures sit within about one and a half standard errors of those, so the 20-day breakout added nothing measurable over entering on any day.
A warning on the every-day averages. Entering at every close includes days when the 10-session low sat a few cents under the close, so 1R was tiny.
On QQQ one such entry (24 December 2018, a 4-cent stop) returned +650R on the trailing stop, and a handful like it carry QQQ’s every-day trailing average of +0.48R. Leave out the top and bottom 1% of entries and that average falls to about zero, while the fixed target stays near +0.27R.
So this is not evidence that fixed targets beat trailing stops in general. It shows that, with entries held the same, the exit rule alone moved the total from about zero to +34R on SPY. Every trade is a row in the SPY file and the QQQ file.
Across our study of 24,971 trading videos, 464 have entry, entries, exit or exits in the title. The median one gets 10,087 views, 70% never pass 50,000, and the median length is 12.9 minutes.
The corpus carries description text for 101 of those 464, and 4 of the 101 mention invalidation, failure, or what a bad read looks like.
Choosing an exit before the entry
The test points to an order of work. Write the exit rule first, then look for entries that suit it.
Ask what the exit needs. A 2R target needs a move twice the stop distance. A 10-session trailing stop needs a trend that does not pull back below the last two weeks of lows.
Count the decisions. With the fixed target in the test, the plan was set for a median 56 sessions. A trailing rule is also set in advance, and it is mechanical too: the stop is the lowest low, nothing to judge.
Test both on the same entries. That is the only fair comparison, and it is the method above. A pullback entry and a breakout entry produce different stop distances, so the comparison has to be redone for each.
Size the position from R. Once the stop distance is known, the share count follows from the amount you accept losing, so neither exit can do more damage than planned, gaps aside.
When it fails
The stop gaps
Five of the 82 fixed-target trades on SPY lost more than 1R because price opened below the stop. The worst was −1.60R, in the worked example. A stop order caps the plan, not the fill.
Out on the first pullback
A trailing stop set too tight turns normal noise inside a trend into an exit. The 10-session rule here gave back a median 0.61R, and a shorter one would exit sooner and more often.
The rule changes mid-trade
Switching from a target to a trail after a good week, or the other way after a bad one, means the exit is being chosen at the worst moment. The test above holds every rule fixed for that reason.
Judging the exit by one trade
The worked example favored the trailing stop. Over 82 trades the total favored the target. One trade is too small a sample to pick an exit, and one rule set on two rising funds is too narrow to settle it in general.
Questions people ask
What are entry and exit points?
The entry point is the price at which a trade is opened and the exit point is the price at which it is closed. The exit can be a profit target, a stop, a trailing stop or a time limit.
Is a trailing stop better than a fixed target?
Not as a general rule. On 82 SPY breakout entries the fixed 2R target averaged +0.42R against −0.01R for a 10-session trailing stop, and QQQ’s breakouts leaned the same way, but that is one entry rule and one stop length on two funds that mostly rose, with no costs. It says nothing yet about other stops or markets.
When should you exit a trade?
When the rule you wrote before entering says so: the stop, the target, or the trailing level. Market structure is a common place to anchor those levels.
Does the entry or the exit matter more?
In this test the breakout entry added nothing measurable over entering on any day, while the exit rule moved the SPY total from −0.66R to +34.29R on the same trades.
Related
Stop loss covers the losing exit in detail, including how the stop price is chosen.
Risk management turns the stop distance into a position size, the step that makes R a dollar amount.
Market structure supplies the swing highs and lows that both entries and trailing stops are often placed against.
Keeping a written record of every entry and exit is part of trading with a plan rather than a feeling.
The entry takes a minute and the exit can still be an open question days later, which is the honest shape of this problem. Decide both before you click — not because it proves discipline, but because judgment gets worse when money is moving on the screen.
— Michael Whitman
This page is educational, not financial advice. Test every idea on your own charts before risking money.