what is sl in zerodha
In Zerodha, SL means “Stop Loss,” i.e., an order type used to automatically exit a trade once the price hits a level you set, so your loss is limited and doesn’t keep growing.
Quick meaning of SL in Zerodha
- SL = Stop Loss order – an instruction to the system to exit your position if the market goes against you beyond a certain price.
- It is mainly used in intraday and short‑term trading to control risk and avoid big losses due to sudden moves.
- Zerodha offers multiple stop‑loss related order types like SL (Stop Loss Limit) and SL-M (Stop Loss Market).
Types of SL orders in Zerodha
| Order type | What it means | Key inputs | How it executes | Main use |
|---|---|---|---|---|
| SL (Stop Loss Limit) | Stop loss that converts into a limit order when trigger hits. | [9][1]Trigger price + Limit price. | [9]When trigger trades, a limit order is sent; it will only fill within your price band, so it may remain pending in fast moves. | [9]When you want more control over the exact exit price and can accept the risk of non‑execution. | [1][9]
| SL-M (Stop Loss Market) | Stop loss that converts into a market order when trigger hits. | [1][9]Only trigger price. | [9]As soon as trigger trades, a market order is fired and usually gets executed, but the fill price can slip beyond your expected level. | [1][9]When guaranteed exit is more important than exact price (high volatility, big moves). | [1][9]
How SL roughly works (simple example)
Imagine you bought a stock at ₹100 and want to risk only ₹5 per share:
- You decide your stop loss trigger at, say, ₹95.
- If you use SL-M , once the price touches ₹95, a market sell order is sent and your position exits at the best available bid (maybe ₹94.90–₹95.10 depending on liquidity).
- If you use SL (limit) , you might set trigger ₹95 and limit price ₹94.90; when ₹95 trades, a limit sell at ₹94.90 goes to the exchange and will execute only at ₹94.90 or better.
So in one line: SL in Zerodha is a risk‑management order that exits your trade automatically once a pre‑decided price (trigger) is hit, using either limit (SL) or market (SL‑M) execution.
Information gathered from public forums or data available on the internet and portrayed here.