Understanding Trailing stop loss better

Hey, I’m a beginner trader, I have a few questions on trailing stop loss(TSL).

My assumption about TSL is that it maintains a minimum distance(from the current price(LTP) to the SL Trigger) in the direction of profit(As at, the time of the creation of TSL). But not in the opposite direction.

It seems like the way it currently works is if the price moves in the opposite direction of profit, the trigger doesn’t move(correct behaviour). However when the price moves in the direction of profit, the jumps occur from LTP(current price).

The more I think about this the more the reality dawns on me that, with every correction and move, the distance between the Trigger and LTP actually reduces.

Is there a way for me to maintain a minimum distance from the LTP to the trigger(While in the direction of profit)? I could keep editing the trigger price with time, but that defeats the purpose of a TSL.

How do I maintain minimum distance automatically?

Further more-

  1. Can we create TSL for futures trading? Eg. BANKNIFTY. With regards to this is a Market order allowed, or do we have to enter a Limit order only?

I only ask this question because if we place Limit orders, when we have to keep adjusting it every time the trigger moves.

  1. We don’t have a TSL for regular stock investments and have to check and adjust the Stop loss everyday. Can this be simplified in any other way, and done using the way we do for trading instruments.

Thanks in advance.

@Kamaal Welcome to Dhan community!

Here’s a detailed video on trailing stop loss to help you - https://youtu.be/vz9i14UsUUY?si=plxd0O--JhQ8wt0T

Thanks @shraddha

My understanding from the video is

The distance between LTP and Trigger price(the percentage) at the time of the TSL creation is not maintained as the price action evolves. And we have to curate the TSL order as time goes.

However the part about Market order for futures was not mentioned.

How does a stale Market order work when trigger price changes. Can you please clarify this.