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Investing & the Stock Market vocabulary · Orders & Trading

Stop-loss order

Meaning in investing & the stock market, with examples

/ˈstɑːp lɔːs ˌɔːrdər/nounCore term

In investing & the stock market, stop-loss order means: An order that automatically sells a security if its price falls to a chosen level, used to limit how much an investor can lose on a position.

In Turkish: zarar durdur emri, stop-loss emri, zarar kes emri

How it is used

Very common among active traders. You set, place, move or tighten a stop-loss order; when the price reaches the level the stop is triggered or hit. In speech it is often just 'a stop' or 'a stop-loss'. Large gaps in price can cause the sale to happen below the stop level.

Example sentences

  1. I set a stop-loss order 8 percent below my purchase price.

  2. The stock opened sharply lower, so my stop-loss order was executed below the level I had chosen.

Common collocations

  • set a stop-loss order
  • stop-loss level
  • trigger a stop-loss
  • tight stop-loss
  • trailing stop-loss
  • limit orderAn instruction to buy at or below a chosen price, or to sell at or above a chosen price. The order is only executed if the market reaches that price.
  • market orderAn instruction to buy or sell a security immediately at the best price currently available, without setting a price limit.
  • volatilityHow much and how quickly the price of an investment or a market moves up and down. High volatility means large, frequent price swings.
  • day tradingBuying and selling securities within the same trading day, trying to profit from small price moves and closing all positions before the market closes.

More terms: Orders & Trading

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This page explains English vocabulary for learners. It is not financial advice.