Greetings everyone, I believe you all are doing great just like me. Is another beautiful day and it is a pleasure to participate in this content title STOP LOSS ORDER, a bountiful and articulate salutations to @khursheedanwar for bringing to us this beautiful content. Thanks so much sir.
In this content I would be sharing my thoughts of what STOP LOSS ORDER is based on my knowledge and I will love to invite this friends of mine, @ranusam @entity @ibesso to participate in this lovely content.
What you understand by stop loss order in trading?
To my best of knowledge and my experience in trading.
A stop loss order is an order that contains an instructions to buy or sell, a security that's set once it's price reaches certain point.
Or in other view a stop loss order is an instructions to kill or end a trade once a specific target is exceeded or reached . A stop limit is an order with 2 specific sprice points that have to be met.
The real difference between this 2 order is of specificity. Because a stop loss order allows you to set a percentage loss. For instance, you could set a stop loss to 20% if the price of your security falls 20% or more than from the price you paid, the order is cancelled.
A stop loss is a design to limit an investors loss on security stage that makes an unfavorable move. One best key advantage of using a stop loss order is, you don't need to be monitoring your holdings daily.
While the disadvantage is that a short term fluctuation can activate the stop limit and trigger an unnecessary sale.
What is the importance of stop loss order while trading?
To my knowledge, a stop loss order is one of the few mechanisms that you have to protect yourself against adverse movements.
It is a function brought up by brokers to limit losses when market moves in a good contrary direction to your position.
In which you can implement it by setting an exit level of a specified amount of pipe away from your entry price.
✅ Stop loss order helps to automate your selling of stocks. A stop loss will automatically triggered in case stocks reaches a pre-determined price. Which helps investors avoid letting their emotions influence their investment decisions.
Thanks so much for your precious time.
Hi dear, I had some experience in this field, but in the end, I abandoned the idea. Stop loss definitely helps, but the real problem is ourselves. It’s not easy to manage trading if you’re not in the industry. Good luck!
👋🌈
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