Risk Management

Trailing Stop

A stop-loss that automatically adjusts as a position moves favorably, locking in some profit while still allowing room for further favorable movement.

A trailing stop is a stop-loss that adjusts automatically as a position moves favorably, locking in some accumulated profit while still allowing room for further favorable movement, rather than staying fixed at the original entry-based level.

See how trailing stops fit alongside standard stop-loss placement in Stop-Loss Explained: How to Protect Your Trading Capital.