Stop Loss means that you want to close your positions at a certain level and price and want to reduce your losses....it is very important in order to be safe and do not loose your all money.....when you apply stop loss at a certain level....so when market moves against your open positions and touches that price where you have applied stop loss...then it will automatically closed at that level and you will safe from further losses......so it should always be applied at that level , which money you can afford to loose.....