stop loss and stop gain

Protect and Maximize Profits with Stop Loss and Stop Gain

The internal turmoil of “Do I hold on to a stock if it’s dipping? How long should I hold? Maybe I should’ve sold it. Oh no, I should’ve sold it a week ago” no longer needs to exist! 

If there’s even a sliver of doubt about when to sell a stock, from negative or positive movement, then learn about the risk management tool, stop loss and stop gain criteria, and get notified about your stocks on your terms! 

What is Stop Loss and Stop Gain? 

Both can make managing risk within a portfolio easier, but first, what are they? 

What is a stop loss? It is a method to limit an investor’s loss on security by selling it if it drops by a specified price/percentage. 

What is a stop gain? It is a method to sell your security and make a profit if it reaches a certain specified price/percentage before a potential dip.

Another way to put it; For stop loss you choose the limit on how much you are willing to lose on a stock before you sell it. Or for stop gains, you choose an expectation/alert for how much you want to gain before selling a stock.

How do they help manage risk? By using these types of alerts, you can specify your risk tolerance (if a stock drops by 15%) or gain expectations (if a stock gains by 25%), and receive alerts that eliminate personal calculations. The software will do it for you. 

They are commonly used when numerous stocks are being evaluated simultaneously, and you don’t have the time or ability to scan them constantly. Using stop loss and stop gain can also lay down a consistent strategy for what you want. You can choose between negative or positive expectations, Whether 15%, 5%, 25%, or more. 

Stop Loss and Stop Gain Analogy

Still trying to figure out the benefit for you? Keep reading for an analogy that elaborates.

Jennifer has a newly acquired lemonade stand and is figuring out her risk tolerance and price expectations. 

She sells lemonade for $2 per cup. But, with inflation, a volatile market, and uncertainty with vendors, she sets expectations for how little and how much she is willing to sell her lemonade. 

The lowest price (stop loss) is $1.50, the minimum for her to make a profit. 

The highest price (stop gain) is $2.50 because she doesn’t want to scare away customers with high prices. 

Jennifer is informed throughout the year when the prices reach the criteria set. If they get to $1.50, she knows profit will decrease, but she will have enough money to continue running the business, and the stand won’t lose money. If they get to $2.50, she knows how high it is and can decide if it’s worth pushing the limit with customers by going higher. 

Real stop loss and stop gain limits will tell you to sell because of a security’s low or high performance. However, the sentiment remains the same with the analogy and reality. You get notified when something drops or climbs according to your parameters. 

Stop Loss and Stop Gain Limits in Equities Lab 

Want to apply this feature to your already extensive screeners/watchlists? It’s simple! Once your desired high-achieving formula has been input, it’s time to put in your stop loss and stop gain limits.

Go to the Trading Rules tab next to Overview (for your watchlists), click on add stop loss, choose your criteria, and now click on add stop gain; choose your criteria; your limits have now been added. 

Once you have your limits, save, then hit refresh and go on your watchlist, that way, your new criteria are input. Specify which stocks you will buy (or have bought), and those added expectations will tell you when to sell based on low or high performance.  

If this is your personal watchlist, the software will tell you to sell when your stocks don’t match those criteria for the limits set. This will be reported on your personal watchlist located on your home page. 


Incorporating stop loss and stop gains into your watchlists takes minimal effort and will help you make future decisions with your expectations. You can use Equities Lab to maintain the criteria you want with the simplest of features, so start today! 

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