The loss attributable to price movement against the position in any one trade from the time that the trade began. So, for example, if XYZ shares were bought for 1000c each and the share has fallen to 900c, then the adverse excursion would be 100c or the degree to which the trade is “out-of-the-money”. Clearly, a strict stop-loss strategy would prevent the adverse excursion from becoming too large as a proportion of the original investment. The term is more commonly used in the derivatives market.

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