I’m fairly new to trading and was checking how to place stoploss in zerodha. I watched this video https://www.youtube.com/watch?v=eXMrEMdQWrQ . In the video the guy taught how to place SL in buy order as well as sell order.
I can understand why place stoploss in buy order, say if I bought 1 share for 90 so to stop it run infinite downwards we place a stoploss.
But what’s point of stop loss in sell ? Say I have 1 share which I got for 80 rs, current market value is 87rs and my sell order is at 90rs why a buy stoploss at 95 rs ?
TIA
There is something called - Short selling
Means you dont have share, and your first trade on the stock is “Sell”. later you have to “Buy” to close the trade
Its usually done in Futures & Options segment
So if u sell at 100, you need to put stop loss at 110 or 120, otherwise it can run infinitely upward and u have to buy later
2 Likes
Wow I didn’t know this. Thanks.
It depends on your analysis and predictions about the asset you are going to invest in. I think stop loss has huge advantages for the beginners. You always have to put stop loss away from the resistance and support levels. Am I right?