Use the stop-loss function to limit and manage potential losses. A stop-loss order is a conditional order that is executed at a specified price after a certain stop price is reached. Once the stop price is reached, the order will buy or sell at the market or limit price, depending on your order parameters. A stop-loss is designed to limit an investor’s loss on a trade that moves unfavorably. For example, you can set a stop-loss at 20% below your entry price. Suppose your entry order is executed at $40,000. The stop-loss order will be triggered when the price drops 20% below $40,000. By setting a stop-loss, you can exit a losing trade earlier and avoid liquidation.