When trading forex there are times when the risk becomes very high, such as when trading with high leverage. Guaranteed Stop Loss is a tool that manages risk and limits potential losses. It effectively closes any order when it reaches the predetermined specified level. It is an automatic instruction on an account that is processed no matter the conditions, therefore it is considered guaranteed by the broker.

How to manage the risk using stop loss

All traders should manage their risks and using a guaranteed stop loss Forex broker is one such way of doing so. A stop-loss tool secures positions when there is unexpected behavior in the market. It is particularly useful for Forex traders who trade when the market is volatile or when trading with high leverage. Also, it is a useful strategy when there is slippage or a gap in price, with prices changing at great speed. Trading with a Forex guaranteed stop loss broker is advisable. However, it is worth noting that not all brokers guarantee the stop at a set number.

 

Guaranteed Stop Loss Forex Brokers List

Broker
Description
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Octafx
OctaFX
Regulation: CySec
Min. Deposit: $/€/£ 5
Leverage: 1:500
Spreads: Low as 0.4 pips

Review


IC Markets
IC Markets
Regulation: ASIC
Min. Deposit: $/€/£ 200
Leverage: 1:500
Spreads: Low as 0.0 pips

Review


XM
XM
Regulation: CySEC,FCA,ASIC
Min. Deposit: $/€/£ 5
Leverage: 1:500
Spreads: Low as 0.1 pips

Review
Globex360
GlobeX360
Regulation: FSCA
Min. Deposit: No min Deposit
Leverage: 1:500
Spreads: Low as 1.6 pips

Review
XTB
XTB
Regulation: FCA
Min. Deposit: $/€/£ 250
Leverage: 1:30
Spreads: Low as 0.1 pips

Review


IQOption
IQOption


Regulation: CySec
Min. Deposit: $/€/£ 10
Leverage: 1:1000
Spreads: Floating from 1 pip

Review


OlympTrade
OlympTrade
Regulation: IFC
Min. Deposit: $/€/£ 10
Leverage: 1:500
Spreads: Low as 0.0 pips

Review
Etoro
Etoro
Regulation: CySEC,FCA,ASIC
Min. Deposit: $/€/£ 200
Leverage: 1:30
Spreads: Variable

Review

Avatrade
Avatrade
Regulation: ASIC,JFSA,FSCA
Min. Deposit: $/€/£ 250
Leverage: 1:400
Spreads: Floating from 1 pip

Review


 

The Advantages of a Guaranteed Stop Loss Forex Broker

The main benefit of a guaranteed stop loss is that the trader doesn’t have to keep an eye on the market all the time. Also, if an event occurs when the market moves greatly, the traders don’t need to be online as their trade will close automatically, even if the market moves against them without their knowledge. The tools also allow traders to eliminate their emotions when making their trading decisions.

It doesn’t cost anything to execute a stop loss. The commission is only charged when the price of the stop loss is achieved. It’s rather like an insurance that’s free.

The Disadvantages

Of course, there are some disadvantages too. But these are mainly when using non-guaranteed stop-loss orders. The main disadvantage is that the stop-loss order could be triggered when there is just short-term variation in the price of a currency. So it is essential to choose a percentage for a stop-loss order that allows the normal fluctuation of the currency but while still preventing huge losses. For example, if you have a 5% stop-loss with a currency pair with fluctuation history of around 10%, this is not going to be a great idea and it will probably result in a loss of money from generated commissions.

In Conclusion

There are no set rules for setting stop-loss orders but, in markets where currency prices change rapidly, it is wise to put a guaranteed stop loss order in place to protect the trader against any unexpected occurrences.