Stop losses

    0
    195

    This post is also available in: German Russian Arabic

    Stop lossesA stop loss is an order that automatically closes your trade at a specified price. This works as a safety stop to reduce risks, protecting your trading capital in the event that the trade does not work out.

    are also sometimes called “stop orders” or “stop orders”.

    To learn how and where to place stop losses, read our lesson:

    We also have a tutorial on how to place a stop loss on MetaTrader 4:

    Example of using a stop loss

    Say you traded forex — you could set a stop loss order with your broker so that if the price you paid on your currency pair falls by 5 pips, your would immediately stop out, limiting your loss to a 5 pip loss. Setting the stop loss at 10 pips would similarly limit your risk to a 10 pip loss if the paid drops by 10 pips.

    Remember: While a stop loss limits your risk and is always recommended, it does not protect you from market gaps and is not a substitute for money management.

    - Advertisement -