A sell trailing stop limit order sets the stop price at a fixed amount below the market price with an attached "trailing" amount and a pre-defined limit price. A limit "delta" is calculated by subtracting the limit price from the stop price, and is used to modify the limit price as the market changes. As the market price rises, both the stop price and the limit price rise by the trail amount and calculated limit "delta" respectively, but if the stock price falls, the stop price remains unchanged, and when the stop price is hit a limit order is submitted at the last calculated limit price. This technique is designed to allow an investor to specify a limit on the maximum possible loss, without setting a limit on the maximum possible gain. "Buy" trailing stop limit orders are the mirror image of sell trailing stop limits, and are used in falling markets.

Trailing stop limits are available for all "Smart" routed stocks, options, and on all futures exchanges which currently support traditional stop orders.

In addition, IB offers adjustable trailing stop limit orders which allows you to define a one-time change to the trailing amount or the limit price.

You're long 100 shares of XYZ with a current market price of $10.00. You set up a trailing stop limit sell order with these parameters:

Trail Amt = 1
Stop price = $9.50
Limit price = $9.45

TWS calculates a limit price "delta" using:
stop price - limit price = .05

The market price rises to $12.00; now your trailing stop price has risen to $11.00, and your limit price is at $10.95. The price drops to $11.00, and your limit order for $10.95 is submitted.