What is Stop Loss?

A Stop Loss (SL) is a risk management tool which aims to add protection to your investment. 

 

It is an instruction to close a trade at a specific rate, if the price is going against you, to prevent additional losses. If the market reaches your requested rate and you have lost the predetermined amount, the Stop Loss will trigger and automatically close your position.

 

A Stop Loss is mandatory on every position with the exception of non-leveraged BUY positions.

 

You can set your Stop Loss according to a specific rate in the market, or as a monetary amount. The default Stop Loss on most trades is 50% of the position amount. In other words, if the value of your position drops to 50% of the amount invested, the Stop Loss will trigger and the position will close automatically.

 

You can adjust the Stop Loss at any time while the trade is open.

 

Under normal market conditions, the set Stop Loss is not guaranteed. When the market is volatile, the Stop Loss rate you requested may not be traded in the market. In this case, the Stop Loss will trigger at the next available rate. The result is that you could lose more than you were prepared to on the trade. We do not compensate for these instances as we do not interfere with market conditions or events.

 

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