How to limit your losses through selling trades

Miscalculations can happen to anyone. You analyze the chart, open the position, and realize, you should not have done it. There is good news for you. Olymp Trade provides the possibility of selling a trade order immediately, whether they’re currency pairs, cryptocurrency, or in this case, financial derivatives. With this method, you wouldn’t need to wait until it expires. It will result in blocking your profit or limiting the losses.

Every option trade can be closed before expiration — Every trade can be closed before expiration

Contents

1 How to sell an order
2 When to sell a trade order

How to sell an order

There are two ways of selling your trade. You can hover the mouse over the offer on the chart so the window with the selling price will appear. Whenever it is acceptable, click on a button with the price. The second way is to press the “Sell now” button visible on the right side of the platform where your trades and orders are displayed.

When to sell a trade order

When you entered the trade and everything seems to go in the desired direction, then selling a financial derivative trade does not make much sense. However, if you realize at some point that the market is going in the opposite direction and you are facing losing the money, then you can use the possibility to sell a trade.

If market is going in the right direction there is no point to sell option — If the market is going in the right direction, there is no point in selling the trade

Be rational. Sometimes it is better to wait a bit before deciding on selling your order. Look at the example below. The trader opened up a position for 100 demo currency and at the displayed moment he can sell it for only 16.00. There are over 4 minutes left and maybe it is better to wait and see how the situation on the market will develop.

Selling 100$ option for 16$ is not so good idea — Selling 100$ financial derivative trade for 16$ is not so good idea

In some cases though, it is better to sell the trade even for a small amount. It is always better to lose less than more. So to minimize loss you can then sell.

Selling an option before expiration allows you to minimize loss — Selling a financial derivative trade before expiration allows you to minimize loss

Note, that the sell button will disappear when less than 1/6 of the expiration time is left. After that time the only thing you can do is sit and watch.

Sometimes you can sell profitable trade for almost nothing

Sell button will disapear if less than 1-6 of expiration time left — Sell button will disappear if less than 1/6 of expiration time left

Remember, there is a free demo account where you can practice trading without the risk of losing real money. You can also check there how selling a financial derivative trade works. So go ahead and open it now.

We wish you always profitable trading!

How to sell an order

When to sell a trade order

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