What is a Stop Loss?

The last thing you want as a trader is to blow your capital therefore, managing and preserving your account is of the utmost importance.

Unfortunately, the market doesn't always move the way we want it to. Sometimes trades won't go your way.

From geopolitics such as elections to new central bank policies set to raise inflation, many factors can influence the market, sometimes drastically so.
This means that even the best traders can take a position that ends up on the wrong side of market movement.

The saying, “Live to trade another day!” should be the motto of every trader - the longer you stay in the trading game, the more you experience you gain and the higher your chances of success.

Stop Loss is an effective tool that limits your losses in the event the market doesn't go your way.

It works by having a predetermined point of exiting a losing trade. This not only provides the benefit of cutting losses early so you can move on to the next trade but also eliminates the anxiety caused by being in a losing trade. Think of it as your trading safety net.