Imagine that the green highlighted candle is the current day and the market has closed. It prevents you from exiting at a poor price, and the limit is set as a percentage of the stop order. Although, we have taken an example above but to make sure that you understand the concept thoroughly, let’s take another example. https://investmentu.com/stop-loss-order-explained-with-examples In the case of a stop-loss, it becomes a market order. Here's an example. Let’s say that you own 1000 shares of ABC Incorp. Here is an example (on the same chart) of when you would put your stop loss order under the current days low. Playing trades over a multi-day time frame can work for a lot of different traders. For instance, if you have bought a stock at Rs 100 and you want to limit the loss at 95, you can place an order in the system … When the stock price drops to $37.50, it trips the stop loss order, and the broker sells it. For example, say you placed a sell stop-loss at $95 while the stock is trading at $100. If the shares drop 5% below market price, you would automatically sell the shares. each priced at INR 200. Trailing Stop Loss (Order) Example. If the price never dips down to $19.50, then your stop-loss order won't execute. A stop order is a conditional instruction. A stop-loss order is an order to sell a security when it reaches a given price. In placing a stop loss, a confirmation window always appear before placing actual order, read those statement carefully before placing your stop loss. You put in a trailing stop loss order for 5%. For example, let’s say a trader has purchased a stock at $20 per share and placed a stop-loss order at $18 a share, and that the stock closes on one trading day at $21 a share. The trade then occurs as soon as a buyer or seller is available while the market is open. The stop loss statement is so self-explanatory, that if the price of KNC coins drops to or below 1.465 and order to sell 315.341 coins will be placed for 1.460. I suggest using this order when you need a trailing stop-loss order. The trailing stop limit order is a trailing stop-loss order with a limit order attached to it. Stop Loss Order Example. Then, after the close of trading for the day, catastrophic news about the company comes out. There are two ways to enter a stop loss order. The market is volatile and as per your analysis, the market may move in any direction. If the price moves past the stop price, it is triggered and converts. Since the current days low is lower than previous day, then you need to put your stop loss order under today's low. You can enter a dollar amount, for example, if your stock is selling at $40 per share, you might enter a stop loss order for $37.50 per share. If you buy a stock at $20 and place a stop-loss order at $19.50, your stop-loss order will execute when the price reaches $19.50, thereby preventing further loss. Let’s assume that you purchase 100 shares of XYZ Company at $100 each. A stop-loss order is a buy/sell order placed to limit the losses when you fear that the prices may move against your trade.