> For the complete documentation index, see [llms.txt](https://docs.bogged.finance/bogged-finance/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://docs.bogged.finance/bogged-finance/product-information/stop-loss-trailing-stop-loss/what-is-a-stop-loss.md).

# What is a stop-loss?

Stop-loss orders are an essential tool for any professional trader. In the crypto market where prices may swing radically overnight, stop-loss orders can be vital, helping traders manage their risk and protect their portfolios.

A stop-loss is a sale order that triggers when the price of a token falls below a specified value.

{% hint style="info" %}
**Example:** A trader holds 1 ETH, worth 2,000 USD. The trader is worried about losing their entire investment if ETH were to crash, so they set a stop-loss to sell the 1 ETH if its value falls below 1,500 USD (-25%). 
{% endhint %}

## How Stop-Loss orders work on the Bogged Platform

Once a stop-loss is placed, the Bogged platform begins to monitor the price of your chosen token. If the price falls below your exit point, a sale is automatically conducted within your wallet. 

{% hint style="info" %}
In the above example, if the price of ETH goes below 1,500 USD overnight, the trader would wake up to find that Bogged has sold the ETH in exchange for 1,500 USD.
{% endhint %}


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