Stop Loss (SL) Explained

A Stop Loss is your safety net. It is an automatic order placed with your broker to sell a stock if it drops to a certain price.

Why is it important?

Because no one can predict the stock market with 100% accuracy. If you buy a stock at $100 hoping it goes to $120, but the company suddenly reports bad news, the stock might crash to $60.

If you set a Stop Loss at $90, your broker will automatically sell your shares the moment the price hits $90. You lose $10 instead of $40. **A stop loss guarantees that a small mistake doesn't wipe out your account.**

StoxPilot automatically calculates a mathematical stop loss for every BUY signal based on the stock's natural volatility (ATR). Always use a stop loss!