How to trade with Guaranteed Stop Loss Orders

A Guaranteed Stop Loss Order, or GSLO, is a risk management tool that closes your trade at the exact trigger value you specify.

Learn more about the key features, the costs, and an example of a GSLO in action.

Key features

GSLOs are a great way to protect your positions from slippage or gapping, caused by unexpected market movements, and close trades at a limit you define. Adding GSLOs to your trades can be a prudent risk management strategy in trading.

Key features include:


Guaranteed closeout

Your trade is guaranteed to close at the price you set up front, making it limited risk.

Free to place

GSLOs are free to place and you’ll only be charged a small premium if the GSLO level is reached.

Amendments

You can amend your GSLO during market hours without incurring additional fees.

Minimum distance

Order levels must be placed at a minimum distance from the current quoted price.

Availability

Offered on a range of our 6,300+ markets, GSLOs provide a cost-effective method of managing your risk.

What are the costs involved?

Stop premium

If your trade reaches the guaranteed stop level and the GSLO is triggered, you’ll be charged a small premium to cover the guaranteed closeout. This is known as the ‘GSLO premium’ and varies by market.

For example, if you bought 2 Australia 200 CFDs (where the stop premium is 1x quantity of CFDs/stake) and placed a GSLO, then your stop premium would be 1 x 2 = $2. You would only be charged this amount if your stop was triggered. You can see the stop premiums on our most popular markets below.

Margin requirement (Professional clients only)

For professional clients, GSLOs enable you to trade with a lower margin requirement than you would with a normal position, as you determine your maximum risk when setting your trade size and GSLO level.

When trading using GSLOs, margin is calculated as follows:

Trade size x stop distance

Stop distance is the distance between the opening price and the stop price.

Indices Premiums
(charged upon trigger)
Minimum distance
Germany 40 0.7 x CFDs or stake* 0.8% of current price
Australia 200 1 x CFDs or stake* 0.8% of current price
Wall Street 1.8 x CFDs or stake* 0.34% of current price
UK 100 0.4 x CFDs or stake* 2.46% of current price
Equities Premiums
(charged upon trigger)
Minimum distance
Apple 0.25% of notional trade value 5% of current price
Commonwealth Bank of Australia 0.5% of notional trade value 5% of current price
Deutsche Bank AG (EUR) 0.25% of notional trade value 5% of current price
Rio Tinto (AUD) 2% of notional trade value 10% of current price
Commodities Premiums
(charged upon trigger)
Minimum distance
Gold 3 x CFDs or stake * 2% of current price
Silver 2 x CFDs or stake * 2% of current price

*Charged in base currency of the market and then converted to the base currency of the account.

Example of a GSLO trade

You believe the Australia 200 market price is going to rise, so you buy 2 Australia 200 CFDs with an opening price of 7000.

You place a GSLO at 6880, which means the maximum loss on the trade would be (7000 – 6880 = 120) x 2 = $240.

The stop premium for the Australia 200 is 1 x the quantity of CFDs and would therefore be 2 x 1 = $2 if your GSLO was triggered.

The required margin is calculated as follows:

Trade Size x Stop Distance

In this example, your margin requirement would be: 2 x 120 = $240.

CI GSLO wall street example AUS 1

As a result of high volatility, the price of the Australia 200 moves against you and unexpectedly drops from 7000 to 6839.

Despite market gapping, your trade closes automatically at your specified GSLO price of 6880.

Your total loss on the trade is therefore $240 (maximum risk) + $2 (stop premium) = $242.

If you had used a standard stop, then your position would have closed at 6839 and resulted in a loss of $322.