Stop-Loss Order
A standing instruction to sell once price falls to a set level, capping how much you lose.
You buy at $100 and set a stop-loss at $90. If the market trades down to $90, the order triggers and sells, usually at market, so you accept whatever the next price is. The point is to bound your downside without watching the screen.
Two warnings. In a fast crash, the fill can land well below your stop. And a brief wick down can stop you out right before price recovers.
Related terms
A stop order that, once triggered, places a limit order instead of selling at market.
Take-Profit OrderA standing order to sell once price rises to a target, locking in gains automatically.
Market OrderAn instruction to buy or sell immediately at the best price currently available in the market.
SlippageThe difference between the price you expected on a trade and the price it actually executed at.