At any given time, no one knows how the market will behave. Regardless of solid spread betting strategies that correctly forecast market treads, figuring unexpected events is hard. So is preparing for its impact on your trade.
A stop loss comes handy in two different ways.
It locks in profits. A simple stop order assists in reducing loses on your spread bet. That is when an underlying market has moved against your position.
The goal is working out an opportune position to place a stop. This is one enhancing chances for money making at the lowest risk.
They let you avoid choking a trade with tight stop losses triggered by normal intra-day volatility. It allows you move a stop loss further from an opening level, preventing a trigger.
Finally, it lets you stop excessive risk relative to a small profit potential.
Hope this made it clear.
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