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Investment
Stop-Loss Order
An order that automatically sells your stock if the price falls to a certain level to limit your loss.
Stop-loss orders protect you from big losses during sudden drops. However, in very volatile markets they can sometimes trigger at worse prices than you expected (slippage). Smart traders place them just below important support levels.
It's like an emergency brake on a rollercoaster — it stops you from crashing too hard.
Real world: You buy a stock at £50 and set a stop-loss at £45. If the price drops to £45, your shares are automatically sold so you don’t lose more than £5 per share.
💡 A stop-loss order is your safety net — it turns a potential disaster into a manageable small loss.