The stop order has been modified into a trailing stop, which can be set at a defined percentage or dollar amount away from the latest market price. An investor who is long a position places a trailing stop loss below the current market price. For a short position, an investor places the trailing stop above the current market price.

Additionally, a trailing stop enables a trade to remain open and continue to profit as long as the price is moving in the investor's favor. The order closes the trade, however, if the price direction changes by a specified percentage or dollar amount.

A trailing stop is typically placed at the same time as the initial trade, but it can also be placed after the trade.

A trailing stop limit order is a type of order that tracks the price of a security and automatically changes the stop-loss level to protect against losses based on a percentage or dollar amount. The stop-loss level can be adjusted in line with a specific rule, such as when the security has increased in price by 10% from its purchase price. This feature prevents stops from being triggered by small fluctuations in prices, which can happen during market swings.

A trailing stop-limit order is a sophisticated stock trading strategy designed to maximize profits while minimizing potential losses. This order type combines elements of both a trailing stop order and a limit order. With a trailing stop-limit order, an investor sets a specific percentage or dollar amount below the current market price as the trailing stop. As the stock price rises, the trailing stop automatically adjusts, maintaining the set distance. When the stock price experiences a decline, the trailing stop remains stationary. The limit order aspect comes into play when the trailing stop is triggered; instead of selling the stock immediately at the market price, the investor sets a limit on the minimum price they are willing to accept. This strategy aims to protect gains during upward trends and secure a favorable selling price during potential downturns, offering a balance between risk management and profit optimization in dynamic market conditions.