trailing stop loss

Definition

A complex stop-loss order in which the stop loss price is set at some fixed percentage below the market price. If the market price rises, the stop loss price rises proportionately, but if the stock price falls, the stop loss price doesn't change. This technique allows an investor to set a limit on the maximum possible loss without setting a limit on the maximum possible gain, and without requiring paying attention to the investment on an ongoing basis.

Use trailing stop loss in a sentence

You should try and make sure that you always follow your trailing stop loss that you set into effect ahead of time.

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While away on vacation I instituted a trailing stop loss on a number of holdings at a rate of 95% of their then current market values.

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Hue had set the trailing stop loss, so this provided some insurance that the losses to the stock shares would not be so great as to put the business in peril.

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