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Market Intelligence › Basic Terminologies
Trigger price, limit price, and the situation in which an SL never fills
Published by The Retail Trader · JUL 24, 2026 · Order Flow
Placing a stop loss and having a stop loss fill are two different things. Many people learn this for the first time when a stock opens gap down and their order sits pending on the screen.
An SL order has two prices. The trigger price is where the order gets activated in the market, and the limit price is the price worse than which you will not accept a fill.
SL-M has only a trigger. As soon as the trigger is hit it becomes a market order, so it will certainly fill — but at what price is not fixed.
Each has its own failure modes:
• SL fails when the price falls through the gap between trigger and limit without stopping — the order stays pending.
• SL-M proves expensive when liquidity is thin — the fill can be very far away.
• On a gap down open, neither fills at the price you had in mind.
• In some segments the exchange does not allow SL-M, so the broker converts it to SL.
A stop loss is insurance, not a guarantee. Its job is to keep the loss small on a normal day — it does not protect against an overnight event, and position size exists for exactly that job.
This article is for educational purposes only — it is not a buy or sell recommendation, it makes no claim of guaranteed returns, and it is not advisory. Rules, rates and mechanics are changed from time to time by the exchanges, SEBI and RBI, so verify every number yourself with your broker or an official source.