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Trading glossary
What Is a Take Profit Order? TP Meaning in Trading
A take profit order, or TP, is an instruction to close an open position once price reaches a target you set. On a long position the target sits above the entry, and on a short position below it. A TP aims to lock in a gain, but the closing price can differ from the target.
In brief
What is a take profit order?
A take profit order, or TP, is set to lock in a gain at a target price. Here is how it works on a long and a short trade, how the arithmetic reads in US dollars, and why it belongs next to a stop loss.
Key takeaways
- A take profit order closes an open position once the price reaches a target you set in advance.
- On a long position the target sits above the entry price. On a short position it sits below, and closing a short at target means buying.
- In the EUR/USD examples on this page, a 50 pip target on 0.20 lots pays US$100 at an assumed US$2 per pip, and a 25 pip stop costs US$50, before costs.
- On MetaTrader 5, take profit and stop loss are levels on the same position, and both are deleted when it fully closes. Other platforms may link them differently, so check yours.
- A target is a plan, not a forecast. On MetaTrader 5 a triggered take profit closes the whole position, and the closing price may not equal the target.
How a take profit order works
A take profit order, usually shortened to TP, is an instruction to close a position when the market reaches a price you chose in advance. The MetaTrader 5 Basic Principles help says that, besides market and pending orders, "there are special Take Profit and Stop Loss levels". Its Executing Trades help calls them additional orders attached to a position or a pending order that instruct the broker to close a position when the price reaches a certain level.
A take profit sits on the side of the entry where the trade is winning. In the MetaTrader 5 help, a long position's take profit is set above the current Bid and checked against the Bid, and a short position's is set below the current Ask and checked against the Ask. On MetaTrader 5 you set it with a new market or pending order, or add it later by modifying the position. Other platforms may label it differently, so check the order ticket before you confirm.
Take profit example: a long EUR/USD trade
This is an illustrative example, not a recommendation. You buy 0.20 standard lots of EUR/USD at 1.0850. The take profit is at 1.0900, which is 50 pips above entry. The stop loss is at 1.0825, which is 25 pips below.
The arithmetic assumes that 0.20 lots is worth US$2 per pip. This is an assumed figure, not a contract specification, so check the value per pip in your broker's contract specification. At US$2 per pip, the take profit gains 50 x US$2 = US$100. The stop loss costs 25 x US$2 = US$50. On these levels the target pays US$100 against US$50 at risk, a reward-to-risk ratio of 2:1.
These figures leave out spread, commission, swap and slippage, and a fill away from 1.0900 would change them.
Take profit example: a short EUR/USD trade
Again this is an illustrative example. You sell 0.20 standard lots of EUR/USD at 1.0850. A short profits as the price falls, so the take profit sits below entry at 1.0800, which is 50 pips down. The stop loss sits above entry at 1.0875, which is 25 pips up.
With the same assumed US$2 per pip, the take profit gains 50 x US$2 = US$100. If the price rises to the stop, the loss is 25 x US$2 = US$50. The reward-to-risk ratio is again 2:1, but the direction is reversed. The take profit closes the short by buying. On MetaTrader 5, buying is executed at the Ask price and selling at the Bid price, so the short is closed at the Ask. The stop loss also closes the short by buying.
Confirm the side on the order ticket before you submit it. The stop loss guide shows the matching stop placement for both sides.
Pairing a take profit with a stop loss
A take profit and a stop loss define the planned exits on each side of the entry before the trade runs. On MetaTrader 5 both are levels on the same position, and its help describes modifying a position as changing its Stop Loss and Take Profit levels. It also says that when a position is fully closed, both levels are deleted, because they are associated with an open position and cannot exist without it.
Other platforms may link the two exits in their own way. Before you rely on a pair, check your broker's order documentation for whether the remaining stop is removed when the target fills. MetaTrader 5 also states that stop loss and take profit orders only trigger for open positions, not for pending orders.
Use the risk-reward ratio page to compare the two distances before you enter.
Take profit, stop loss, trailing stop and limit order compared
The table compares four order types that often sit together on a trading screen. FINRA's page is written for US stock orders, so confirm how your broker applies its rules in other markets.
| Order | What it does | Price it reacts to | Main trade-off |
|---|---|---|---|
| Take profit (TP) | Closes the entire position when the price reaches the target level (MetaTrader 5) | Long: set above the Bid and checked against it. Short: set below the Ask and checked against it | Ends the trade at the target, so any further move is not captured |
| Stop loss (stop order) | Closes the entire position when the price reaches the loss level (MetaTrader 5) | Long: set below the Bid. Short: set above the Ask | FINRA: once the stop price is reached, the order "automatically turns into a market order" and is executed at the current market price |
| Trailing stop | Moves the stop loss to follow the price as the profit grows (MetaTrader 5) | A distance from the current price that you select | On MetaTrader 5 it runs in the platform, not on the server, so it does not work while the platform is off |
| Limit order | An order to buy or sell at or better than a specified price (FINRA) | A buy limit executes only at or below the limit, a sell limit only at or above it | FINRA: "there's a chance your order doesn't get executed at all" if the market price fails to match or better the limit |
Sources: MetaTrader 5 Basic Principles help (take profit, stop loss and trailing stop rows) and FINRA's investor page on order types, written for US stocks (stop order and limit order mechanics). Verified on 9 November 2026. Check your broker's order documentation for its own rules.
For the entry side of the comparison, see what is a limit order. The order management page covers how orders are handled, and the product availability record shows the status of each RTX5 feature.
What happens when a take profit order triggers
On MetaTrader 5, activation of a take profit closes the entire position. For exchange stock and futures symbols, the help says the levels trigger under the exchange's rules, usually when the Last price touches the level, while the resulting buy or sell is still performed at the Bid and Ask prices.
If the closing trade cannot be executed when the take profit activates, for example because the exchange rejects it, MetaTrader 5 does not delete the order. It triggers again at the next tick that meets its conditions, so the closing price may not be the target. FINRA notes that with a market order on stocks "you might not get the price you saw", especially in fast-moving markets.
A partial close works differently. If you close only part of a position, MetaTrader 5 leaves its Stop Loss and Take Profit unchanged, so the remaining volume keeps the same target. Gaps and slippage are covered in the stop loss guide, and partial fills in the limit order guide.
Where to place a take profit
This guide does not recommend a target. One common convention is to place it at a level chosen before the trade, such as a prior swing high or a zone marked on the chart.
Check the target against the stop and the amount you accept to lose. The position size calculator sizes a trade from the stop distance. It does not choose the target for you. A farther target may take longer to reach, and a nearer target may close sooner but cap the gain. A target is a plan, not a forecast of where the price will go.
Risk disclosure
- A take profit does not promise the gain. The price can reverse before the target is reached, and a stop loss or a manual close can end the trade first.
- The closing price may not equal the target, and on MetaTrader 5 a rejected closing trade triggers again at the next tick.
- Spread, commission, swap and slippage reduce the result. The examples on this page leave them out.
- Check how your broker handles the remaining exit when one fills. On MetaTrader 5, both levels are deleted when the position fully closes.
- A level can be refused. MetaTrader 5 help says stop level requirements are set by the broker in the symbol properties (contract specifications), and that an incorrectly specified Take Profit or Stop Loss brings up an "Invalid stops" alert and the order is not accepted.
- This page is educational and is not personal financial advice. Trading can lose money, and the examples are illustrative only.
RTX5 status
RTX5 is Orrnn's trading terminal and broker-technology product. Its Windows desktop client is in preview, and the web and mobile clients are planned. A Google Play listing for Android is published, but the mobile client has no approved release record yet. Check the product-availability record before relying on any RTX5 feature. This page does not confirm take profit support in any RTX5 client.
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Primary references
Sources were checked on 9 November 2026. They explain market rules and concepts; they do not certify RTX5 or provide individual financial advice.
MetaTrader 5 Help: Executing TradesDescribes Take Profit as a level set to lock in profits of a position, and Take Profit and Stop Loss as additional orders attached to a position or pending order that instruct the broker to close the position when the price reaches a level. States that Stop Loss and Take Profit orders only trigger for open positions, not for pending orders, and that incorrect levels bring up an "Invalid stops" alert. Checked 9 November 2026.MetaTrader 5 Help: Basic PrinciplesStates that buying is executed at the Ask and selling at the Bid, and that there are special Take Profit and Stop Loss levels. Says Take Profit activation closes the entire position, long levels are checked against the Bid and short against the Ask, a rejected closing operation triggers again at the next tick, a partial close leaves the levels unchanged and a full close deletes them, and Trailing Stop runs in the platform rather than on the server. Checked 9 November 2026.MetaTrader 5 iPhone Help: Modifying a PositionSays modifying a position means changing its Stop Loss and Take Profit levels, and that stop level requirements are determined by the broker and specified in the symbol properties (contract specifications). Mobile help page, checked 9 November 2026.FINRA: Order TypesInvestor page on US stock order types. Describes a limit order as an order to buy or sell at or better than a specified price, with a chance it is not executed at all; a stop order that automatically turns into a market order once the stop price is reached; and notes that with a market order you might not get the price you saw, especially in fast-moving markets. Checked 9 November 2026.RTX5 product availabilityRTX5 status record. Use it to check which RTX5 products and clients are live before relying on any order feature.
Questions readers ask
What does TP mean in trading?
TP stands for take profit. A take profit order is set at a target price, and when the market reaches it, the position is closed to lock in a gain. The MetaTrader 5 help describes take profit as a level set to lock in profits of the position. On a long the target sits above the entry, and on a short it sits below.
Does a take profit order guarantee the profit?
No. A take profit sets a target, not a result. The price may never reach the target, and a stop loss or a manual close can end the trade first. On MetaTrader 5 the closing trade is performed at the Bid or Ask, and a rejected closing trade triggers again at the next tick, so the closing price may differ from the target. Spread, commission and swap still apply.
Should I set a take profit and a stop loss together?
Setting both defines the planned gain and loss before the trade runs. On MetaTrader 5 both are levels on the same position, and both are deleted when the position fully closes. Other platforms may link the two exits differently, so check that the remaining exit is removed when one fills. This is an educational point, not a recommendation on what to set.
How is a take profit different from a limit order?
On MetaTrader 5 a take profit is always connected to an open position or a pending order, and its activation closes the entire position. A limit order, in FINRA's description, is an order to buy or sell at or better than a specified price, and it may not be executed at all. On MetaTrader 5, Buy Limit and Sell Limit are pending orders in their own right. Check your platform's documentation for how each behaves.
Does RTX5 offer take profit orders?
This page does not confirm take profit support in any RTX5 client. RTX5 is a trading terminal and broker-technology product. Its Windows desktop client is in preview, and the web and mobile clients are planned. A Google Play listing for Android is published, but the mobile client has no approved release record yet. Check the product availability record before you rely on any order feature.
Keep learning
What is a stop-loss order?How a stop loss becomes a market order, where it sits for each side, and where the fill can differ.What is a limit order?How a limit order sets a maximum buy or minimum sell price, and why it may never fill.Risk-reward ratioHow to compare the distance to a target with the distance to a stop before you enter.Order managementThe order-management page covers order handling. Its status is set out on the product availability record.Position size calculatorWork out a position size from the amount at risk and the distance to your stop.