There are a number of brokers that offer guaranteed stop loss from those we have put together a quick list of. Here it is:
How to Find Best Forex Brokers with Guaranteed Stop Loss
When you are trading, it is important to execute trades at the requested price levels that you want. Also if the trade goes against the predicted direction there should be the safest stop loss to protect the trading account. So in this article, Let’s learn more about how to find the best forex brokers with guaranteed stop loss.
Stop-loss is a market safety measure that helps to limit the losses you might suffer while still being able to make a profit. If it is easier, consider a Forex stop loss as a guarantee against price gaps, market changes, and other unexpected changes that are difficult to account for. Fluctuations happen in any market you may be using.
What are Price Gaps and Slippage?
A gap is created when a currency pair has a difference in price between the end of market trading on a Friday and the beginning of trading on a Monday. A visible gap can sometimes be found in this trading and that gap can cause issues with orders that are left. Orders and stops that end up in the gap are not completed.
Slippage is when a price difference is changed very quickly. This may happen when you have an order set for a specific date and time and then a disaster hits or a market has a sudden change. The price slips. In most conditions, a stop is filled when the next good available price can be found. You will occur slippage though.
Guaranteed Stop Losses During Gaps and Slippages
When you have a guaranteed stop loss in effect, your order is executed no matter what conditions you find yourself in. Your order is guaranteed to be completed no matter what. Price gaps and slippages are not excluded, your order will still be executed.
Why Traders Might Like Stop Loss Guarantee
Professional and experienced traders create plans for trading and sometimes that includes needing to trade after or during press releases or when market conditions aren’t at a peak. Sudden market changes can sometimes be predicted or part of a plan. Traders that need to be able to trade when a normal broker will hold orders and stops, need to look for a guaranteed stop-loss Forex broker.
Facts to Keep in Mind When Considering Guaranteed Stop Loss When Trading in Foreign Exchange
There are a few facts that you should keep in mind when you are considering trading in foreign exchange. Take a look at them:
- You can only place orders or stops 5% from the close of the market
- Guarantees may not always be available
- Your Forex broker has discretionary power when considering stop-loss trades
- Stop-loss trades can be called in over the phone with most brokers instead of online
- Stop-loss trades come with limitations depending on the market, it depends on the market and the broker
- A majority of Forex brokers do not offer guaranteed stop loss due to concerns and the need for knowledge to operate the system
- You might incur fees or additional costs when conducting stop loss trading
- The opposite of guaranteed stop loss is a limit order
The Cost of Making a Guaranteed Stop Loss
As we mentioned, a guaranteed stop loss often includes a fee. The fee is also known as a premium. If you decide to order with a stop loss, you will notice that it is typically wider by 3 points. Exact fees or premiums depend on the broker you are using.
The most recommended time to use a guaranteed stop loss is when you are expecting high-impact events or one that has recently happened. It helps to ensure trading during slippage.