Trailing-Stop Orders

Trailing-stop orders are a specific type of order that comes into play if the market price moves against your position by a predetermined amount known as the Trail Amount. These orders offer increased flexibility and automation in trading. Here's how they work: When the market price moves in favor of your order, the stop price trails the market at a fixed distance. However, if the market moves against your position, the stop price remains static to safeguard against potential losses. This unique feature allows traders to set a cap on the maximum potential loss (the trail amount) without needing to define a limit on the maximum potential gain. When the market reaches the trigger price, a market order is triggered. For example, let's say a trader is in a long position with a current price of 500. They can initiate trailing-stop orders with a price distance of 20, which creates a sell stop order at 480. Unlike a regular stop order, if the price keeps rising and reaches 550, the trailing stop will adjust to 530 accordingly. However, if the price falls to 530, a market order will be activated. 

For information on further order types, visit Delta Order Types. For video demonstrations, visit  Delta Youtube channel.