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What is stop loss, how to set it, types of stop loss, trailing stop loss — complete Hindi guide for traders.
Published by The Retail Trader · AUG 17, 2026 · Features
What is stop loss, how to set it, types of stop loss, trailing stop loss — complete Hindi guide for traders.
Stop loss is a pre-defined price level where you automatically exit — to limit your loss.
Simple definition: > Stop loss = "If the price reaches this level then get out." This is your insurance.
Example:
• You bought Reliance for ₹2,500.
• Stop loss: ₹2,450 (2% below entry)
• If Reliance falls ₹2,450 → Auto sell → Loss limited to ₹50/share
Without stop loss: Reliance falls to ₹2,200 → ₹300/share loss (6x worse)
1. Fixed Stop Loss:
• X% below entry price
• Example: 2% below entry
• Best for: Beginners
2. Support-Based Stop Loss:
• Slightly below support level
• Example: Support at ₹2,450 → SL at ₹2,430
• Best for: Swing traders
3. ATR-Based Stop Loss:
• 2× ATR from entry
• ATR = Average True Range (stock's average daily movement)
• Best for: Advanced traders
4. Trailing Stop Loss:
• Moves with price (locks in profit)
• Price goes up → SL also goes up
• Price goes down → SL remains the same
• Best for: Trend following
Decide stop loss first — not after taking the trade.
"A loss of ₹100 can be tolerated" → Wrong "Support is at ₹2,450, keep SL at ₹2,430" → Correct
Keep SL too close → trigger early → unnecessary loss
SL will keep very close → there will be huge loss on trigger.
"SL deletes hoon, will go back to aa" → Biggest mistake
How does it work?:
• Entry: ₹2,500
• Initial SL: ₹2,450 (2%)
• Price becomes ₹2,600:
• → Trailing SL: ₹2,540 (2% below ₹2,600)
• → Profit locked: ₹40/share
• Price becomes ₹2,700:
• → Trailing SL: ₹2,640 (2% below ₹2,700)
• → Profit locked: ₹140/share
• Price becomes ₹2,650:
• → SL hit at ₹2,640
• → Exit with ₹140/share profit
Trailing SL = Keep locking profit as price moves in your favor.
Keep these four points in mind:
• Intraday — SL Type: Fixed/ATR, SL Size: 0.5-1%
• Swing — SL Type: Support-based, SL Size: 2-3%
• Positional — SL Type: Support/ATR, SL Size: 3-5%
• Long-term — SL Type: 200 DMA, SL Size: 8-10%
“Trigger is triggered by placing SL” — without SL a trade can eat up the entire account.
"Put the SL a little lower hoon" — it increases the loss. SL move only in FAVOR (trailing).
If you keep 0.2% SL then it will trigger normal noise. Consider the volatility of the stock.
"Will not sell now, will come back" — SL hit = exit. No negotiation.
SL imposed on ₹2,500 → everyone has SL vehicle → stop hunt can happen. Put the round number a little below (₹2,480).
Keep these points in mind:
• 📌 STOP LOSS QUICK REFERENCE
• TYPES:
• 📊 Fixed — X% from entry
• 📊 Support — Below support level
• 📊 ATR — 2× ATR from entry
• 📊 Trailing — Moves with price
• RULES:
• ✅ SL decide first
• ✅ Chart-based, not emotion-based
• ✅ Not too tight (volatility consider)
• ✅ Not too loose (risk limited)
• ✅ NEVER remove SL
• ✅ Use Trailing SL (profit lock)
• BY STYLE:
• 📊 Intraday: 0.5-1%
• 📊 Swing: 2-3%
• 📊 Positional: 3-5%
• 📊 Long-term: 8-10%
• AVOID:
• ❌ No stop loss
• ❌ Moving SL away from entry
• ❌ Too tight SL
• ❌ Emotional override
• ❌ Round number SL (stop hunt risk)
Keep these five points in mind:
• What Is Risk Management?
• What Is Swing Trading?
• What Is Intraday Trading?
• How to Identify Support and Resistance?
• What Is Trading Psychology?
The Retail Trader — educational market analysis. Not investment advice.
This article is for educational purposes only. It is not a buy or sell recommendation, a claim of guaranteed returns, or advisory guidance. Exchanges, SEBI and RBI change rules, rates and procedures from time to time, so verify every figure with your broker or an official source.