You can then select the specific knock-out level at which your position will be closed out if the market goes against your prediction.
Once you have made these two decisions, the opening price of the position will be calculated as follows:
- Bull: (your provider’s underlying offer price – knock-out level) + knock-out premium*
- Bear: (knock-out level – your provider’s underlying bid price) + knock-out premium*
*A knock-out premium is your guarantee against slippage. You’ll receive it back if you close the trade without the knock-out level being triggered.
Your maximum risk is the opening price multiplied by your stake size, so you always have control over how much you stand to lose if your position is knocked out.
Learn more about knock-outs trading with IG