GlossaryBeginner
Take-Profit Order
An order that automatically closes a position once a specified gain-locking price is reached.
A take-profit order automatically triggers a sale once an asset's price rises to (or, for a short position, falls to) a level specified in advance, intended to lock in a gain without needing to actively watch the market.
It's commonly used alongside a stop-loss order, so both a position's downside and upside exit points are decided in advance.
Examples
- A trader might set a take-profit order at a specific target price to automatically lock in gains.
- Setting both a stop-loss and take-profit in advance defines a position's full planned exit strategy.