Stops and Limits On CFDs

Stops and limits provide increased protection against adverse market movements by setting an automatic closing level for your position.

Both are available by phone and online, giving you the freedom to manage your risk even while you are away from your desk.

You can place stop and limit orders when you open a new position, or add or edit an order on an existing position.

For more about how stop and limit orders work, view our examples page.

Stops

A stop (or stop loss) is an instruction to close your trade should the market move against you.

If the market falls, the order limits your losses by closing your position at the level you have specified.

Stops are non-guaranteed, which means that if the market doesn’t trade through your chosen level you may be forced to exit the position at the next available price.

This is called slippage, and can occur overnight or in fast-moving markets, when there may be gaps in prices.

Limits

Whereas a stop order closes your position to cap potential losses, a limit order closes a profitable position at your chosen level in order to lock in the gains.

Without a limit, your initial profits could potentially be lost if the market turned negative after your desired price has been reached.