Stop-loss order (Stop-Loss)
A sell order that triggers automatically once the price reaches or falls below a level you set.
In short
As of 8 October 2026A stop-loss order is a sell order that triggers automatically when the price reaches a level you set. It then usually sells as a market order at the next price. The stop is not a guaranteed price: if the price gaps, the sale can happen much lower. A stop-limit order prevents that but may not be executed at all.
With a stop-loss order you set a price below the current one. If the stock falls to that stop, a market order to sell is triggered automatically. The idea is to limit larger losses.
Important: the stop is not a guaranteed sale price. If the price gaps, for example overnight after bad news, the sale happens at the next available price, which can be much lower. A stop-limit order prevents that, but may then not be executed at all. With high volatility, stops also often trigger just before the price recovers.
Example: you buy at 50 euros and set a stop-loss at 45. If the stock opens at 40 after a profit warning, it is sold at roughly 40, not 45.
Related terms
Sources
As of 8 October 2026 · Educational content, not investment or tax advice.