How the trailing stop is calculated
Long: Stop = Highest price − Trail (or Highest × (1 − Trail %))
Short: Stop = Lowest price + Trail (or Lowest × (1 + Trail %))The stop only ever moves in the trade's favour. If price pulls back, the stop stays where it is.
Worked example
You buy 100 shares at ₹500 with a 5% trailing stop. The initial stop is ₹475. The stock rallies to ₹560, so the stop rises to 560 × 0.95 = ₹532. If it is hit, you keep ₹32 a share, ₹3,200 in total, even though the trade started with ₹2,500 at risk. The stop reached breakeven once price crossed about ₹526.32.
Frequently asked questions
What is a trailing stop loss?
A stop loss that moves in your favour as price moves in your favour, staying a fixed distance (points or %) behind the best price reached. It never moves back against you.
Points or percentage — which is better?
Points suit a single instrument where you know the typical swing size, like Nifty. Percentages scale with price, so they work better across stocks of very different prices.
How wide should my trail be?
Wide enough that normal noise does not stop you out — many traders use 1.5–3× the Average True Range (ATR). A trail that is too tight exits good trades early.
Results are estimates for educational purposes only and are not investment, tax or financial advice. Verify figures with your broker or advisor before acting on them.