This is designed to protect paper profits on a stock, without actually selling the stock. (thecollegeinvestor.com)
Losing paper profits, you are up $ 1,000 on a trade then a massive whip saw takes back those profits in one move and you end up back at even on the trade. (newtraderu.com)
Sales on credit will only create paper profits if the debts are not recovered from the customers. (myfinancekits.com)