Limiting the losses incurred by investors while trading is very challenging. However, online brokers, with the help of technology, are always on the lookout for doing just that. There is a kind of order in day trading called a ‘trailing stop loss,’ which allows you to dynamically adjust your stop loss based on the direction of price movement.
If the price of the security moves in your favorable direction, the stop price moves with it. However, if the price of the security is no longer favorable for you, the stop price, in that case, stays in place.
This article will explain to you all about trailing stop loss, how to use them, and which trailing stop loss is the best.
Also Read: All you wanted to know about Stop Loss Strategies
What is a Trailing Stop Loss in Stock Trading?
When you are a part of the stock market, it is quite natural that you will suffer losses at some point in time. However, if you are very keen on protecting yourself from day trading losses while locking in your profits, a trailing stop loss (TSL) is the perfect order for you.
A trailing stop-loss order makes sure that your unrealized profit doesn’t get wiped away due to wild price swings.
Broadly, there are five types of orders that you can place with your broker. Let’s take a look at them: Also Read: How to calculate Stop Loss in an Excel Sheet? Now, let’s look at how trailing stop-loss order is beneficial: A trailing stop loss order is a wise choice for risk management. A trailing stop loss certainly helps in preventing a winning trade from turning into a losing trade. If not that, it reduces the amount of the loss if your trade does not work out. So, are you ready to give the trailing stop loss order a chance? 
How is Trailing Stop Loss Beneficial?
Final Thoughts
