A stop loss is a preset order that closes your position once price reaches a level you choose, limiting how much you can lose on the trade. It is a core risk-management tool that removes emotion by deciding your exit in advance.
Forex Term
Stop Loss
An order that closes a trade automatically to cap a loss.
Example
Buying EUR/USD at 1.1050 with a stop loss at 1.1030 caps the loss at 20 pips.
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Trading Forex and CFDs involves a significant risk of loss.
Risk
Forex and CFD trading involves significant risk of loss and is not suitable for all investors. Leverage can work against you. This content is educational and not financial advice — always do your own research.