What is Stop Loss

This order is intended to minimize losses in case the price of a financial instrument starts moving in an unprofitable direction.

If the instrument price reaches this level, the position will be closed automatically. Such order is always connected with an open position or a pending order. When checking the condition of this order for long positions the Bid price is used, and when checking short positions the Ask price is used. To automate the moving of a stop loss order following the price, a trailing stop can be used.