What Is a Trailing Stop Loss?
A trailing stop loss is a type of day trading order that lets you set a maximum value or percentage loss that you can incur on a trade. If the price of the stock rises or falls in your favor, the trailing stop goes with it, but if the price rises or falls against you, the stop stays in place.
For example, the chart below has a 5% Trailing Stop Loss. This is extremely helpful because it allows traders to not have sit and monitor every stock they’re in and it prevents traders from incurring a huge loss.
