A trailing stop-loss is an order that allows traders to set a specific percentage or dollar amount away from the market price of an asset. This mechanism helps protect gains by enabling an asset to remain open and continue to rise while automatically adjusting the stop-loss order higher as the price increases.For example, if a trader buys a cryptocurrency at $100 and sets a trailing stop-loss at 10%, the stop-loss would initially be at $90. If the price rises to $120, the stop-loss would adjust to $108—10% below the new price. If the price then falls back to $108, the order triggers, and the position is sold, securing profits.This strategy is particularly useful in volatile markets, where prices can change rapidly. It allows traders to take advantage of upward movements while limiting potential losses, making it a popular risk management tool.