Trailing stop or take-profit: which exit is better?

They encode opposite beliefs about what happens after you're up. A take-profit says gains mean-revert: bank +7% before it fades. A trailing stop says gains trend: stay in and surrender only a fixed slice from the peak. Neither is universally better — our backtests show profit targets winning on choppy mean-reverting assets (frequent small wins) and trailing stops winning wherever trends extend (rarer, larger wins). A practical rule: match the exit to the entry's thesis. Mean-reversion entries (RSI, dip-buying) pair naturally with targets; momentum and breakout entries pair with trails. Mixing them — momentum entry, tight target — routinely amputates the winners the entry was designed to catch.