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Quick read · 2 min

Why widening a stop costs more than the loss

Your stop is the price where your trade idea is wrong. Moving it further away doesn't make the idea right — it only makes the same wrong idea cost more.

The damage is in the average. A trader who risks 1R and sometimes lets it become 2R needs a far higher win rate to break even: two widened losers erase four normal winners at 1:1.

On a prop account it's worse, because a trailing drawdown counts the open loss. One widened stop can take a chunk of the room you need for the whole evaluation.

The fix is mechanical: place the stop with the entry (a bracket order) and only ever move it toward your entry, never away.

TradeCompass turns this into your own rules: it checks every trade against them and warns you before you break one.

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Educational content only. Not financial advice, not a buy/sell signal, no guaranteed results.