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Investment
Trailing Stop
A stop-loss that moves up automatically as the price rises, locking in profits while letting the trade run.
Trailing stops let winners run while protecting gains. They can be set as a percentage, fixed amount, or based on technical levels like moving averages. They are very popular with trend-following traders.
It's a dog on a retractable lead — it follows you when you run forward but stops you from falling too far back.
Real world: You buy a stock at £50 and set a 10% trailing stop. When the price rises to £70 the stop moves to £63. If the stock then drops to £63 the trade closes and you lock in £13 profit per share.
💡 Trailing stops are how you turn good trades into great trades.