What is the trigger price in a stoploss order?

The trigger price is the point at which a buy or sell order becomes active for execution on the exchange servers. When the stock's price reaches the trigger price set, the order is sent to the exchange servers.

Once the stop-loss order is triggered, the limit price becomes the price at which shares will be sold or bought. To learn more about limit orders, see What are limit and market orders?

Components of Stop-Loss Orders

The stop-loss (SL) order consists of two price components:

• The stop-loss price is also referred to as the stop-loss limit price.
• The stop-loss trigger price is referred to as the trigger price.

Example Scenario

A client places an SL (Stop Loss - Limit) for ITC.

• Once the stock price reaches ₹206, the order becomes active, triggering a limit order at ₹208 sent to the exchange.
• The stock will be purchased at either ₹208 or a lower price if sellers are available at that point.

A stop-loss order is a passive order. The trigger price acts as a threshold, and the stop-loss order becomes active only when the market price crosses this threshold, whether it's above or below the stop-loss price. To learn more about stop-loss orders, see What are stop-loss orders and how to use them?