What is a stop loss order?

A stop loss is an order type popularly used by traders as part of their risk management strategy. It closes a previously opened position at a price you specify, helping to limit potential losses on a trade if the market moves against you.

Essentially, a stop loss is a limit point that you add to your order. Once this limit point is reached, your order is automatically closed. Stop loss points are always set below the current Bid price for long positions, and above the current Ask price for short positions.

For more information, watch our video tutorial.