Does stop-loss help to avoid the risk?

Does stop-loss helps to avoid the risk

It's actually a little complicated. Obviously, without a stop loss, it's very risky to trade on the market. Therefore, both beginners and experienced traders use this tool. And those who don't use it - make a mistake and always risk much more than they should. But stop loss doesn't completely save a trader from risks. It only minimizes the risks, reducing them to such an indicator, which will be adjusted by the trader himself. It is very useful to use the stop loss tool in trading, because you don't know what can happen to your deal in a few hours, when you won't be monitoring the market. Or if you are a trader who works for the long term strategy, you can't do without this tool either. In fact, there are many hidden opportunities in the stop loss, and it really limits the trader's risks. But it doesn't completely relieve you from risks and losses. Unfortunately, this miracle tool hasn't been invented yet.

Nicely explained above, just understand that stoploss is crucial as a risk management tool but it's not the only thing that you need to avoid risks.

I think, yes. But I think it can not completely help to avoid risks. It can help you not to face a huge risk.

Practice shows that this measure is still relevant. Stop loss is a reliable way to close unprofitable positions in time and protect your deposit from unplanned losses and unnecessary risks. Even if you think you are able to control positions in the market on your own and can close them manually if necessary, this isn't the case. It is enough to distract yourself from the monitor for 5-10 minutes, and a sharp jump in the price can significantly reduce your deposit, or the connection will be interrupted at the most inappropriate moment, or electricity will go out. At the end of the day, you may simply lack the resolve to close a losing trade (losing money is always a pity) and you'll continue to watch as the price rises in the hope of reversing the price in your account. In addition, you can use the stop loss, which is set in time. If an order remains in the market for a certain period of time, for which the price does not show any pronounced dynamics, then the transaction is closed regardless of the available result.
Therefore, traders who work not only on the long term, but also on the short term - should use the stop loss. Otherwise, you will simply lose money, which could be saved using a simple order. Think about whether it was worth it?

I agree, it is one of the tools to minimize risk but not the direct solution to avoid risk. For minimising risk we need to have a solid risk management strategy.

I use this tool anyway. More safe is better than not safe at all.

Which tool are you referring to?

Stop loss is very much needed for the new traders who don't want to face a huge loss in their early trading career.

You can use stop loss to minimize your risk, basically manage risk with this tool.

The stop loss protects you from extreme risks. But, if the stop loss is placed to tight, it will work opposite. The market needs some space to show its actual move. If the stop loss is too tight in context to the current price, a slight draw-down or opposite price movement will trigger your stop loss and close the trade at loss. But on the other hand if it is placed systematically, the prices will get their space to breathe and will continue with its positive direction. Its better that you place a stop loss with your maximum pip losing capacity.

I think the way to think about it is a stop loss allows you to manage your risk (not avoid it completely). With trading in general this is always risk. No one has a 100% win rate. Stop losses are about protecting you downside so that you can develop a long-term positive expectancy from your system.

I think stop loss can not help to avoid the risks completely. Though it is a helping hand to minimize the risk, it can not completely mitigate risks totally. You need to make proper strategy too minimize the risks and make profit.

A forex stop loss is a function offered by brokers to limit losses in volatile markets moving in a contrary direction to the initial trade

It depends on what type of strategy you are following. What are your risk and reward ratio? What's the winning percentage. All these things need to consider to understand whether stop loss will reduce your risk or not.

That's very correct, new traders often mistake stoploss to be a fail-safe mechanism not realizing that there are other aspects to risk management.

Yes. But professional traders don't rely on stop loss to avoid their risks. They make plans for minimizing the risks and make money from this market.

This market is very risky due to its volatility. The secret of earning money from it, is to know how to control risk, considering that you cannot avoid it. So, I personally strongly recommend application of SL and TP orders, especially SL. It can save a lot of money to trader

It's a bit complicated. Stop loss is one way to minimize risk. But there are more things. Your profit target should be equal to your stop loss provided that you win more trade than lose. Or it can be 1:2, 1:3 or 1:4. Basically it is associated with your winning trade percentage.

Yes ofcourse! A stop loss will limit the scope of the loss that could occur to your account. It is a limit that if the loss goes beyond this point, the position will be closed automatically.