Zerodha....
- Thread starter bharath.mang
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- Tags bakwaas now cheapest brokerage nest nest plus new broker zerodha zerodha trader
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I am a firm believer in Mr Wister's quote: " Don't be afraid to ask dumb questions, theyr'e more easily handled than dumb mistakes." 
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Every stop loss needs 2 things(trigger and price) ...
Trigger is the point where you want your stop loss to be activated.. assume you bought nifty at 5000 and you want to place a stop loss.. Say you are ready to take a 25pnt loss... So you want to have a stop loss at 4975...
In the above case, assume you keep your trigger price at 4975, what happens is till 4975 is recorded on the exchange your stop loss will not get activated... as soon as 4975 is recorded on the exchange, your trigger gets activated and your order is placed on the exchange... This order that goes to the exchange now is what you need to decide if it has to be market or limit...... at 4975, you can send your order either for selling nifty at market price or send it at limit price.... if you send market, it guarantees you execution, if you send limit it doesn't...
Does it mean that if you put a SL-M, it guarantees you execution??
No, it guarantees execution only if your trigger price is hit on the exchange.
in the above example, what if nifty fell from 4980 to 4970 in 1 shot?? 4975 will not be recorded in the exchange and hence your trigger will not get activated...
The gist of the story is that, stop loss orders doesn't guarantee exit... Again, if you are putting stop loss , SL-M is a much better option(in liquid contracts)....
Cheers...
... Every stop loss needs 2 things(trigger and price) ...
Trigger is the point where you want your stop loss to be activated.. assume you bought nifty at 5000 and you want to place a stop loss.. Say you are ready to take a 25pnt loss... So you want to have a stop loss at 4975...
In the above case, assume you keep your trigger price at 4975, what happens is till 4975 is recorded on the exchange your stop loss will not get activated... as soon as 4975 is recorded on the exchange, your trigger gets activated and your order is placed on the exchange... This order that goes to the exchange now is what you need to decide if it has to be market or limit...... at 4975, you can send your order either for selling nifty at market price or send it at limit price.... if you send market, it guarantees you execution, if you send limit it doesn't...
Does it mean that if you put a SL-M, it guarantees you execution??
No, it guarantees execution only if your trigger price is hit on the exchange.
in the above example, what if nifty fell from 4980 to 4970 in 1 shot?? 4975 will not be recorded in the exchange and hence your trigger will not get activated...
The gist of the story is that, stop loss orders doesn't guarantee exit... Again, if you are putting stop loss , SL-M is a much better option(in liquid contracts)....
Cheers...
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