Stop-loss

A stop-loss is an automatic instruction to sell a stock if its price drops to a specific level you set in advance. Think of it as a safety net: you decide beforehand how much loss you're willing to accept, and the broker handles the exit for you if that price is hit. You'll encounter stop-losses whenever you're setting up a trade, and they matter because they help protect you from panic-selling or watching a bad position get worse. For example, if you buy shares of TechCorp at $50 and set a stop-loss at $45, your shares automatically sell if the price falls to $45, capping your loss at $250 per 100 shares.