Stop orders can be used to minimise trading losses, whilst not inhibiting your ability to make unlimited profits. Stop orders include stop loss orders and trailing stop orders.
Enabling traders to control level of risk which they are exposed to, the stop loss is a useful tool for any trading account. A trading stop loss can be placed alongside positions on a range of trading products from Forex, to CFD and Equities. This allows for strategic trading by enabling traders to limit the risk of excessive losses. Allowing flexibility, a stop loss can be employed to ensure that traders don't need to keep an eye on the markets 24 hours a day.
The trailing stop allows investors to set a pip distance between the current price, and the point at which they intend to exit the trade. If the current price should fall by that number of pips, the position will automatically be sold. If the current price rises, the percentage level will be recalculated from the new high. Using a trailing stop is an excellent method for minimising loss, whilst locking in profits in the event that the markets move against an investment position.
Both regular stop loss orders and trailing stop orders are available through a Saxo Capital Markets trading account. Depending on the asset class traded, a variety of stop instruments can be used to match the kind of financial risk limitations traders seek.