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How to set the stop-loss order?

One of the first lessons learned by a beginning trader involves the creation of stop-loss orders and their placement to protect the account from unexpected market fluctuations. The general wisdom among traders is that using an absolute, numerical stop-loss value where the maximum loss is about 2 percent of the account is a prudent choice. While it is effective, this way of setting up a stop-loss point is by no means the only way of minimizing losses of an account.

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