Glossary/Risk/Stop Loss
RiskDay 3 of 1000

Stop Loss

Definition

A preset exit that closes a trade if price moves against you to a chosen level, capping the loss. It is usually placed as a stop order with your broker.

Example

You buy 100 shares at $50 with a stop loss at $47, limiting the planned loss to about $300 unless the stock gaps lower.

Please use one. It caps your loss before you even enter.

In plain words

A preset price where you get out if the trade goes against you.

The chart
Chart explaining Stop Loss

A preset exit that caps your loss.

The slides

All 4 slides, still.

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Trading in the Zone

by Mark Douglas

[Placeholder: your one-line take on why this book helps with Stop Loss.]

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