Stop-Loss Order

An order placed with a broker to sell a security when it reaches a certain price. It is designed to limit an investor's loss on a security position. This is sometimes called a "stop-market order".


In other words, setting a stop-loss order for 10% below the price you paid for the stock would limit your loss to 10%.

It's also a great idea to use a stop order before you leave for holidays or enter a situation in which you will be unable to watch your stocks for an extended period of time.




The Stop-loss Order - Make Sure You Use It - It's a simple but powerful tool that can help you implement your stock-investment strategy. Find out how.

Trailing-Stop Techniques - The important decision to exit a position must be based on more than emotion if you want to be a disciplined trader.

The Basics Of Order Entry - Taking control of your portfolio means knowing when to use particular orders and if they pose added costs.

Limiting Losses - It is impossible to avoid them completely, but there is a systematic method you can use to control them.
Related Terms

Buy-Stop Order

Stop Order

Stop-Limit Order

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