Setting Trailing Stops on thinkorswim®️ desktop

Trailing stop orders commonly serve as a risk management tool for open positions. With these orders, a trader sets a stop below the current market price, expressed as either a percentage or a specific dollar amount. If the stock moves higher, so does the stop, with the potential for additional gains or reduced losses; whereas if the price drops, the stop order remains set—and if the stock falls to the stop price, it triggers a market sell order designed to limit losses. (A trailing stop on a short position works in reverse, with a trader setting a stop above the current market price. If the stock moves lower, so does the stop; if the stock moves higher and reaches the stop price, it triggers a market sell order.)

1. Under Monitor, click Activity and Positions, then scroll down to your positions.
2. Right-click on the stock for which you'd like to create a trailing stop order, hover over Create closing order, then click with STOP.

1. The platform will take you to the Trade screen, where it has populated an Order Entry to sell the exact quantity of the stock you own as a sell-stop order.
2. Under the Order column, click STOP, then select TRAILSTOP.
3. Under Price, the offset—the amount by which your trailing stop order will trail the market price—defaults to –$0.10. To change it, click inside the box, type in your offset amount, then hit Enter. (You can also adjust the offset using the +/– arrows.)
4. Under Link, click MARK to select the price your offset will trail:
   • For stocks with narrow bid/ask spreads, MARK is a common choice because it's the midpoint between the bid and ask prices and may offer protection against temporary, anomalous price swings in volatile markets.
   • For stocks with wider bid/ask spreads, using BID can potentially help your execution price be closer to your desired exit, though it also may be more sensitive to short-term swings.
5. Under TIF (time in force), click DAY, then select GTC (good 'til canceled) to ensure your order remains active until either a price move triggers a sale or you cancel the order.
6. Click Confirm and Send to review your order.

1. If everything looks good, click Send to place the order.

1. You can find your orders under Monitor by clicking Activity and Positions, then Working Orders. Your orders will display from newest to oldest.
2. To cancel an order, click the menu icon at the end of the row, then click Cancel order.