are more complex to set up compared to other types of orders
stop limit order vs stop loss orderboth a stop limit order and a stop loss order are useful for traders trying to manage risk there are key difference between the two that change the situation where each may be best first a stop loss order becomes a market order when the price of the security hits or falls below the stop price this means that the order will be executed at the best available market price which may be different from the stop price in contrast a stop limit order becomes a limit order when the stop price is reached and will only be executed at the limit price or better therefore the two have different execution points there is also pricing protection differences a stop loss order does not offer any price protection beyond the stop price this means that if the market is experiencing rapid price movements or gaps the trade may be executed at a price below the stop price on the other hand a stop limit order offers price protection as it specifies a limit price at which the trader is willing to buy or sell this allows a trader to have greater control over the execution price in addition a stop loss order is guaranteed to be executed once the stop price is triggered but the execution price may not be guaranteed in contrast a stop limit order is not guaranteed to be executed as the order will only be filled if the limit price is met therefore a stop loss order is better should a trader want to ensure a trade is executed regardless of price 1example of a stop limit orderfor example assume that apple inc aapl is trading at 155 and that an investor wants to buy the stock once it begins to show some serious upward momentum the investor has put in a stop limit order to buy with the stop price at 160 and the limit price at 165 if the price of aapl moves above the 160 stop price then the order is activated and turns into a limit order as long as the order can be filled under 165 which is the limit price the trade will be filled if the stock gaps above 165 then the order will not be filled buy stop limit orders are placed above the market price at the time of the order while sell stop limit orders are placed below the market price 