A stop-loss order specifies a trigger point for buying or selling a stock. When the current market price of the stock reaches that trigger point, the order becomes a regular market order and is filled at the current market price. However, if the stock price doesn't reach the trigger point, the order doesn't get executed. Usually, stop-loss orders are placed by traders well in advance to avoid making huge losses on loss-making positions or to book profits by implementing trail stop losses when the price moves beyond a certain point.