Stop-Loss

A stop-loss order is an order placed with a broker to buy or sell a security when it reaches a certain price. A stop-loss order is designed to limit an investor's loss on a security position.

For example, if you buy a stock at $50 and want to limit your loss to 10%, you could place a stop-loss order at $45. If the stock falls to $45, your shares will be automatically sold.

Stop-loss orders are an important risk management tool for traders. They can help to protect you from large losses, especially in volatile markets. Indicators like Average True Range (ATR) can be used to help determine an appropriate stop-loss level.