Take profit order

A resting instruction attached to an open position, naming the price at which the position is to be closed in profit. It sits on the opposite side of the market from the position: above the opening price where the position is long, below it where the position is short. Mechanically it is a limit order, which is what makes it behave differently from a stop, and it works to close an existing position rather than to open a new one.

The level is set as a price, and platforms convert a distance into a price rather than the other way round. Because a limit order can only be filled at its level or at a better one, a market that gaps straight through the level fills the order on the far side of the gap, which is to the position's advantage. That asymmetry runs the opposite way to a stop, where a gap is filled at the next available price and is to the position's disadvantage.

The trip is treating the level as certain to be reached. An order resting at a price is an instruction that becomes executable when the market trades there, not a promise that it will. A market can approach the level, turn a fraction short of it and leave the order untouched, and a limit resting at the very edge of a move may see the price printed without enough size available to fill the whole order, which leaves it partly filled. Practitioners disagree about whether a target should be fixed at entry or moved as the position runs, and the disagreement is unsettled precisely because the two conventions fail in opposite conditions.