What is Emergency Stop, and why you may need it?
Stop losses are a vital component of trading, which ensures that your account stays healthy. It is one of the important elements of strict management, which is taught by top financial institutions. Proprietary firms out there are now making it compulsory for any incoming trader to have a trading strategy that utilizes a proper stop loss.
On your path to becoming a profitable trader, you must know how to enter or exit your position. For any buy/sell local trade in MT4/MT5®, a stop-loss order will be placed below/above it, which will determine your way out, if the market goes against you. Good knowledge of executing your SL and TP can help you save your account from certain doom. Financial news can move the markets by a margin of 100 pips in a matter of seconds, and a trade of just 1 lot with this type of volatility can take away a thousand bucks from your account.
As we know about the need to use stop loss in our trading, it is also essential to understand how we can manipulate it. For our needs, we can use Forex Copier, an automated copy trading software that provides us numerous ways to control our trading. The emergency stop feature allows you to get out of your trades if the account equity goes below a certain level. It is there to control all your requirements or account management needs mentioned above. We will shed some light on the topic to help you understand the feature much better.
How Does Emergency Stop Feature Work In Forex Copier?
Go to the account setup in Forex Copier and turn on use of Emergency Stop to see the range of options available. All the trades that have been shifted from Source to Receiver account come under the forex copytrading software’s measures.
Set a custom equity level, enabling the auto trade copier to stop copying any orders if the account value depreciates more than the specified amount. Check this option and set the numbers within the box to enable this setting.
Image 1: Select the highlighted setting to stop further copying of trades when equity is less than set.
Drawdown Percentage Based Copying
Enable this setting, and the mirror trading software will not copy further trades if the account value drops more than the set drawdown percentage.
For example, you have a 10,000 dollars account with the max drawdown value set as 10 percent. Your current trades are running, bringing the overall account deficit to 9,000. As this exceeds the margin of 10 percent, then no further trades will be copied from the source account.
Drawdown Value Based Copying
As with the drawdown percentage, the same applies to the value; the only difference is the first one is a percentage while the latter is a number. Enter the number you’d like to consider to activate this option to avoid further copying.
Profit Based Order Closure
There are two options within this setting. The first one allows you to close your orders based on the percentage profit achieved. The second one determines the gain in terms of numbers and closes the trade on that. See the image below.
Image 2: Profit Based Order Closure in trading copier.
Benefits Of Using Emergency Stop
The following benefits can be achieved using the Emergency Stop feature of Forex Copier:
Know before your forex brokers about any future margin calls.
Get better risk management on your account.
Can be extremely helpful for you to manage losses.
You don’t need to monitor the trades yourself to know when your equity is low.
No need to manually close your profitable positions when your account has made a particular gain.
Having proper stop losses and risk management can help you become a profitable trader faster.
Indeed, the best forex copy trader delivers everything when it comes to copy trading. Going in to fight the bears and bulls without any weapons will make you vulnerable, probably resulting in a loss of morale and ultimately quitting trading. Using the emergency stop feature of Forex Copier will undoubtedly allow you to stay in the game for much longer and eventually allow one to get a consistent taste of profits.