# Trailing Stop

*Trading & Technical Analysis — Finicade finance glossary*

A trailing stop follows the price up by a set distance or percentage and never moves down, locking in gains while leaving room for the trend to continue. It automates the hardest part of trend following — letting winners run without giving everything back. Set too tight it exits on ordinary noise; set too wide it surrenders most of the gain before triggering.

**Also known as:** trailing stop loss, ratchet stop

**Related terms:** [Stop-Loss Order](https://finicade.com/glossary/stop-loss-order), [Stop-Limit Order](https://finicade.com/glossary/stop-limit-order), [Risk-Reward Ratio](https://finicade.com/glossary/risk-reward-ratio), [Trend Following](https://finicade.com/glossary/trend-following), [Position Sizing](https://finicade.com/glossary/position-sizing)

Source: https://finicade.com/glossary/trailing-stop