#StopLossStrategies

A stop-loss strategy is a risk management tool used by traders and investors to limit potential losses on a trade. It involves setting a predetermined price at which a position is automatically sold to prevent further loss. For example, if you buy a stock at $100 and set a stop loss at $95, the position will close if the price drops to $95. This strategy helps protect capital, reduce emotional decision-making, and maintain trading discipline. Stop-loss orders can be fixed or trailing, adjusting with market movement. Using a stop-loss effectively is essential for preserving funds and staying in the game long-term.