How to Place Stop-Loss Orders to Limit Losses on Robinhood App Stocks


The Robinhood app has made stock trading easy and accessible for many beginner investors. However, the stock market can be volatile and lead to losses if proper risk management is not utilized. One way to limit losses on Robinhood is by using stop-loss orders.

A stop-loss order is an order placed with your broker to sell a stock when it reaches a specified price. It helps lock in profits and limit losses by automatically selling shares before the losses get bigger. This article will provide a comprehensive guide on how to place stop-loss orders on the Robinhood app to effectively limit losses.

Types of Stop-Loss Orders on Robinhood

There are two main types of stop-loss orders available on Robinhood:

Standard Stop-Loss Order

This converts to a market order when the stop price is reached. The order executes at the next available market price, which may differ from the stop price.

Stop-Limit Order

This combines features of a stop order and limit order. When the stop price is triggered, it converts to a limit order rather than a market order. You specify a lower limit price to prevent selling below a specified price threshold.

How to Place a Stop-Loss Order on Robinhood

Placing a stop-loss on Robinhood only takes a few taps:

  • Log into your Robinhood account either on the mobile app or website
  • Search for the stock and pull up the details page
  • Tap “Trade” and select “Sell”
  • Choose the stop-loss order type: “Standard” or “Stop-Limit”
  • Enter the number of shares and stop price
  • For stop-limit, also enter the limit price
  • Review and submit the order

Tips for Effective Stop-Loss Orders

Here are some tips to utilize stop-losses effectively and avoid common mistakes:

Set Reasonable Stop Prices

Set stop prices that make sense for the stock’s volatility. If too tight, normal price fluctuations may trigger the stop-loss unnecessarily.

Use Charts and Indicators

Utilize stock charts and technical indicators to identify key support and resistance levels that can inform stop price decisions.

Consider Market Volatility and Liquidity

Take into account periods of high volatility and low liquidity where stop prices have a higher chance of being triggered prematurely.

Monitor and Adjust

Actively monitor your positions and adjust stop prices accordingly as the market moves to balance limiting losses against preventing premature selling.

Use Other Order Types

Also utilize limit orders, buy limits, and bracket orders to further control buying and selling prices.

Have a Trading Plan

Have a plan for your trade exits instead of relying only on stop-losses. Use them as part of an overall risk management approach.

Common Questions

Does a stop-loss guarantee my shares will sell at the set stop price?

No. A standard stop-loss converts to a market order when triggered, so your shares will execute at the next available market price after the stop price is reached. Only a stop-limit guarantees a sale price threshold.

Can I set stop-losses on options or crypto in Robinhood?

Yes, Robinhood allows stop-losses on options and cryptocurrencies. The process works the same as for stocks.

When is my stop-loss order triggered during extended hours trading?

Stop-loss orders are only triggered during regular market hours, 9:30 AM – 4:00 PM Eastern. Price movements in extended hours will not activate a stop-loss.

What happens if the stock gaps down below my stop price at market open?

If a stock gaps down below your set stop price at market open, your stop-loss will trigger based on the opening price of the stock on the next trading day.


Effectively using stop-losses is crucial for managing risks and limiting losses, especially for Robinhood traders. Determine suitable stop prices, account for volatility and liquidity, actively monitor your positions, and use stop-losses as part of an overall trading plan. With the right strategy, stop-losses can help cut losses and preserve investment capital over the long-term.