In this article I’m going to show you how to place a trailing stop-loss order in zerodha pi. So first I start with what is trailing stop-loss order meaning & in which cases we are placing a trailing stop-loss order. So in this article I’m assuming that you are already familiar with bracket order. If you don’t know what is bracket order & how to place a bracket order. Than I definitely recommend you to read my article on How to Place a Bracket Order in Zerodha pi. If you already read my bracket order article than you know how to place a buying order with target & stop-loss order in under one order window.
Trailing Stop-Loss: We are placing a trailing stop-loss order when we want to protect our market gain. Still confused don’t worry I clear this with an example. Now suppose that you bought a abc stock at the price of 100. Your target price is 10 points above the your buying price & your stop-loss is 5 points below the buying price which means your target price is (100+10) 110 & your stop-loss price is (100-5) 95. In bracket order there is one additional trailing stop-loss order. If I ticked that trailing stop-loss box & entered the 1 in trailing stop-loss order box. Now what happen next whenever the price of my stock is start moving 1 point upward direction my stop-loss is also move 1 point upward. So if my stock moves 7 points upward (Which means 100+7=107) than my stop-loss order is also moves 7 points higher (which means 95+7=102). So with this I can protect my market gains.
So now If the stock start moving downward from 107 & hit the 102 than I’m still in profits of 2 Rupees each stock. Because my actual buying price is 100 rupees. So in simple words with trailing stop-loss order you can protect the market gain that you made. So if you entered the 2 in trailing stop-loss order box than every 2 points move of stock in your direction your stop-loss will also moves 2 points higher. If the stock moves 1 point instead of 2 points than your stop-loss order remains the same because the stock still has to move 1 point higher in order to complete 2 points moves.
So this is the example of trailing stop-loss order.
Stock: Idea Cellular
Limit price: 92
Target points: 10 (92+10=102)
Stop-loss Points: 5 (92-5=87)
Trailing Stop-loss points: 1
So if the stock moves 92-93 than my stop-loss also moves 87-88. Click on this In order to see this example clearly.
So this is from me in this article. I you like it you know what to do next. If you have any question than leave your comment down below. I definitely helps you out. You can also read my another article on placing a cover order on zerodha pi. If you don’t know how to place Limit, Market SL and SL-M order than you can also read my that article too.