What is Take-Profit?
A take-profit is an order that closes a position once the price reaches a chosen favorable level, locking in the gain to that point. For a long position it is set above the entry; for a short it is set below. It is usually a limit order, so it fills at the target price or better but only if the market actually trades there.
Why Take-Profit matters
It defines an exit on the winning side in advance, removing the in-the-moment decision of when to take a gain.
Related terms
Lessons that use this term
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