How to Place a Stop Loss Order on Robinhood

Setting a stop loss order on Robinhood

A stop loss order tells Robinhood to sell a stock automatically if its price drops to a level you choose. When the stock hits that price, Robinhood converts your stop loss into a market order and sells at the next available price. This protects you from larger losses if a stock moves against you, though the actual sale price may be lower than your stop price in a fast-moving market.

To place a stop loss on Robinhood, open the stock you own, tap the three-dot menu, select "Place Order," choose "Sell," then tap "Sell Stop." Enter the stop price (the price at which you want to sell), review the order, and confirm. The order stays active until the stock hits that price, you cancel it, or the market closes for the day if you set it as a day order.

Stop loss orders are not may provide to execute at your chosen price. In a gap down or during fast market moves, your stock may sell below the stop price you set. Robinhood converts the stop into a market order once triggered, meaning it sells at whatever price is available at that moment.

Key Takeaways

• Stop loss orders on Robinhood automatically sell your stock if the price drops to a level you set, protecting against larger losses.
• You place a stop loss by opening a stock position, tapping the menu, selecting "Place Order" and "Sell Stop," then entering your stop price.
• Your stock may sell below your stop price if the market moves quickly or gaps down, because the order becomes a market order once triggered.
• Day orders expire at market close; good-till-canceled (GTC) orders remain active across multiple trading days until you cancel them or they execute.

Step-by-step process for placing a stop loss

Open Robinhood and navigate to the stock you currently own. Tap the stock name or chart to open the detail page. At the bottom of the screen, you will see a three-dot menu icon (or "Trade" button depending on your app version). Tap it and select "Place Order."

On the order screen, make sure "Sell" is selected. Tap the order type dropdown—it usually shows "Market" by default. Change it to "Sell Stop." Enter the stop price: this is the price at which you want Robinhood to trigger the sale. For example, if you own a stock at $50 and want to limit losses, you might set a stop at $45. Review the order summary, which shows how many shares will sell and at what stop price. Tap "Submit Order" or "Confirm" to activate it.

Once placed, your stop loss order appears in your "Orders" tab. It remains active until the stock price touches your stop price, you manually cancel it, or the order expires (day orders expire at market close; GTC orders stay active across trading days).

Day orders versus good-till-canceled orders

Robinhood offers two time frames for stop loss orders: day orders and good-till-canceled (GTC) orders. A day order expires automatically when the market closes that same day if the stock has not hit your stop price. A GTC order remains active across multiple trading days until either the stock triggers the stop, you cancel it manually, or 90 days pass (Robinhood's GTC limit).

Most traders use GTC orders for stop losses because they want protection that lasts beyond a single trading day. If you set a day order stop loss and the stock drops the next day, that order will not execute because it expired. To set a GTC order, tap the time dropdown when placing your order and select "Good for 90 days" or the GTC option available in your version of the app.

Check your active orders regularly. If you sell the stock through another order or your position closes, any stop loss order tied to that stock will be canceled automatically.

What happens when your stop price is triggered

When the stock price touches or falls below your stop price, Robinhood immediately converts your stop loss into a market order. This market order sells your shares at the best available price at that exact moment. In normal market conditions, this price is close to your stop price. In volatile or fast-moving markets, the actual sale price can be significantly lower.

For example, if you set a $45 stop on a $50 stock and the market opens with a gap down to $42, your stop loss triggers at $42 (or lower) because that is the market price when the order executes. You cannot may provide the exact price—only that the sale will happen once the stop is triggered.

After your stop loss executes, the order disappears from your active orders list and appears in your order history. You can review the execution price and timestamp there. If you want to own the stock again, you must place a new buy order.

Risks and limitations of stop loss orders

Stop loss orders do not protect you from all losses. The main risk is slippage—the difference between your stop price and the actual sale price. In a stock that gaps down overnight or during market volatility, you may sell at a price well below your stop. This is especially common in stocks with low trading volume or during earnings announcements.

Stop losses can also lock in losses during normal price swings. If a stock drops to your stop price temporarily and bounces back up, your shares are already sold and you miss the recovery. Some traders use wider stop losses (further from the current price) to avoid this, but that means accepting larger potential losses.

Robinhood does not offer stop limit orders on all account types. A stop limit would let you set both a stop price and a limit price (the minimum you will accept), preventing sales below your limit. Without this tool, your stop loss becomes a market order with no price floor. Check your account type and Robinhood's current offerings to see if stop limit orders are available to you.

Common mistakes when using stop losses

Setting your stop price too close to the current stock price is the most common mistake. If you own a stock at $50 and set a $49 stop, any small dip triggers the sale. This often locks in losses during normal volatility. Most traders set stops 5 to 10 percent below the purchase price, though this depends on how volatile the stock is and your risk tolerance.

Forgetting to cancel old stop loss orders is another frequent problem. If you sell a stock manually but leave a stop loss order active, the order will be canceled automatically. However, if you hold the stock and place multiple stop orders by mistake, only one will execute (the first one triggered), but you may have confusion about which order is active. Always check your active orders before placing a new one.

Using day orders when you meant GTC orders (or vice versa) can also cause problems. A day order expires at market close, leaving you unprotected overnight. If you want continuous protection, select GTC. Remember that GTC orders expire after 90 days on Robinhood, so you may need to reset them periodically if you hold a stock long-term.

Alternatives to stop loss orders

If Robinhood's stop loss tool does not meet your needs, you have other options. Stop limit orders (if available on your account) let you set both a trigger price and a minimum sale price. This prevents sales below your limit but also means the order may not execute if the stock gaps past your limit price.

Manual monitoring is another approach: you watch the stock yourself and sell when it hits your target price. This gives you full control over the sale price but requires active attention and is not practical for long-term holdings or multiple stocks.

Some traders use trailing stops (available on other platforms but not Robinhood's standard interface) that automatically adjust upward as the stock rises, locking in gains while protecting against reversals. Robinhood does not offer trailing stops natively, so you would need to manually adjust your stop price as the stock moves up.

Frequently Asked Questions

Can I set a stop loss order on stocks I do not own yet?

No. Stop loss orders only work on shares you currently own. You cannot place a stop loss on a stock before you buy it. You must first purchase the stock, then place the stop loss order from your holdings.

What is the difference between a stop loss and a stop limit order?

A stop loss becomes a market order and sells at any available price once triggered. A stop limit order becomes a limit order, which only sells if the price is at or above your limit price. Stop limit orders may not execute if the stock gaps past your limit. Robinhood does not offer stop limit orders on all account types.

Will my stop loss order execute during after-hours trading?

Stop loss orders on Robinhood execute during regular market hours (9:30 a.m. to 4 p.m. ET). If a stock gaps down in after-hours trading and opens below your stop price, your order will trigger at market open. You cannot place or modify stop losses during after-hours trading on Robinhood.

What happens if I cancel a stop loss order?

Canceling a stop loss order removes it immediately. Your stock remains in your account unsold. You can place a new stop loss order at any time, but there is no protection between the cancellation and the new order. If you want to change your stop price, cancel the old order and place a new one with the updated price.

Can I set multiple stop loss orders on the same stock?

Robinhood allows only one active stop loss order per stock position. If you try to place a second one, the system will reject it or ask you to cancel the first order. If you want to change your stop price, you must cancel the existing order and place a new one.