Trailing Stop Loss is a smart way to protect your gains without manually monitoring your trades. It's like having a safety net that moves up with your stock price but never comes down. When your stock price goes up, your stop loss automatically follows it up, staying at a fixed distance below. But if the price drops, your stop loss stays put and triggers an exit if the price falls too far. A regular stop loss stays at one price. Trailing stop loss keeps moving with your profit.

Example

You buy a stock at ₹100 and set a trailing stop loss with a ₹5 gap.

• Stock rises to ₹110 - Your stop loss moves to ₹105
• Stock rises to ₹120 - Your stop loss moves to ₹115
• Stock drops to ₹115 - Stop loss triggers, position exits

You just locked in ₹15 profit instead of watching your gains disappear! So, as your stock climbs, you automatically protect more and more of your gains. No need to keep updating your stop loss manually. Your position stays open as long as the trend is in your favor. Only exists when momentum reverses.