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Partial exits & runners

1/3 at T1, 1/3 at T2, trail the last third.

9 min · Advanced · Free lesson

What you'll learn

  • Split a position into thirds with planned exits at T1, T2 and a trailed runner
  • Calculate blended R across partial exits
  • Compare the outcomes of partials, all-out at T1 and a reversal after T1

The idea

A single exit forces a single bet: either you sell everything at the first target and miss the big days, or you hold everything for the big days and give back gains on the average ones. Partial exits solve this by splitting one trade into three jobs.

The first third pays you at T1 and takes pressure off. The second third captures the next level at T2. The last third, the runner, is trailed behind structure to catch the occasional trend that goes much further than planned.

Think of it like a relay team. The first runner gets you on the board, the second carries the lead, and the anchor has room to run as far as the race allows. No single leg has to do everything.

How it works

  1. Plan three exits before entry. T1 is the next level and must be at least 2R. T2 is the level after that. The runner has no fixed target; it is trailed.
  2. Size in thirds. Choose a share count divisible by three, or as close as you can. With options, this works cleanly with 3 contracts: one per job.
  3. At T1, sell one third and move the stop to breakeven. You now have a trade that cannot become a loss on the remaining shares, apart from slippage.
  4. At T2, sell the second third. Keep the stop at breakeven or raise it behind the most recent higher low.
  5. Trail the runner behind structure. Move the stop under each new confirmed higher low on your entry timeframe (above each lower high on shorts). Exit when a candle closes through the trail.

Worked example

Hypothetical: $30,000 account, 1% risk, so 1R is $300.

You buy XYZ at $80.00 on a confirmed retest. Stop at $79.00. T1 at $82.00, T2 at $83.50.

  • Risk per share: $1.00
  • Size: $300 ÷ $1.00 = 300 shares, split into three 100-share pieces
  • T1 is $2.00 per share, or 2R. T2 is $3.50 per share, or 3.5R.

Scenario A: full plan plays out.

  • T1: 100 shares × $2.00 = $200. Stop moves to $80.00.
  • T2: 100 shares × $3.50 = $350.
  • Runner trailed under higher lows, stopped out at $84.50: 100 × $4.50 = $450.
  • Total: $1,000, about 3.3R.

Scenario B: all-out at T1.

  • 300 shares × $2.00 = $600, exactly 2R.
  • Solid, but on this day you left $400 on the table.

Scenario C: price hits T1, then reverses.

  • T1: 100 shares × $2.00 = $200.
  • Remaining 200 shares stopped at breakeven: $0.
  • Total: $200, about 0.67R.
  • All-out at T1 would have made 2R here. Partials cost you on this day.

The point is not that partials always win. They do not. Scenario C shows the cost. What partials do is smooth your results: you get paid something on most trades that reach T1, and you keep exposure to the rare trade that runs far. Over many trades that combination is easier to execute calmly than an all-or-nothing exit.

Common mistakes

  • Taking the first partial before T1 — you cut the part of the trade that pays for your losers — sell the first third only at the planned T1 level.
  • Forgetting to move the stop after T1 — a winner can turn into a full loss on two thirds — move to breakeven the moment T1 fills.
  • Trailing the runner too tightly — normal pullbacks knock you out — trail behind confirmed higher lows, not a fixed few cents.
  • Setting T1 below 2R to feel safe — the math of the whole system weakens — T1 must be the next level and at least 2R.

Checklist

  • Are T1, T2 and the trail method written before entry?
  • Is T1 at least 2R away?
  • Is my size split into three pieces?
  • Did I move the stop to breakeven when T1 filled?
  • Is the runner's stop under the latest confirmed higher low?

Practice: Three-part exit plan

  1. In Paper Sim, choose a setup where T1 is at least 2R and a second level exists for T2.
  2. Size the trade in a number of shares divisible by three and place limit orders at T1 and T2.
  3. When T1 fills, immediately move the stop on the rest to breakeven.
  4. Trail the runner under each new confirmed higher low and exit only on a close through the trail.
  5. Record blended R in your Trade Journal and compare it to what all-out at T1 would have made.

Key takeaways

  • Split each trade into three jobs: T1, T2 and a trailed runner.
  • At T1, sell one third and move the stop to breakeven.
  • Partials cost some profit on trades that reverse after T1, but they smooth results and keep exposure to large moves.
  • Always calculate blended R so you know what the plan actually made.

Glossary

  • Partial exit — Selling part of a position at a planned level while keeping the rest open.
  • Runner — The final piece of a position, held with a trailing stop to capture an extended move.
  • Blended R — The combined result of all partial exits expressed in multiples of initial risk.

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