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Limit Order Example. For example, you want to buy ABC Inc. at $50. The stock is currently trading at $51, so you set a limit order to buy at $50. The price may go up or it may go down, but you know that as soon the stock trades at $50, your order will be triggered and you'll buy at your predetermined price.
If you place a $5 buy limit order, you are instructing your broker to buy 100 shares at any price up to $5 per share. Limit orders generally have deadlines (i.e., the latest date on which the trade may be executed before it is canceled) and they usually cost more to execute than market orders.
Submit a stop limit order online or with a broker. Set two price points: Stop: The price that triggers a limit order. Limit: The minimum/maximum price the security will be bought or sold for. Set a time frame for the stop limit order. If no time frame is specified, the order remains in place until the stop triggers or it is canceled.
The investor sets a stop-loss for $1 below the maximum price and a limit of $0.50 below the stop-loss. If the security is purchased at $100 per share, let’s assume it rises to $101 per share before dropping to $99 per share. This triggers the stop loss. Your broker now generates a limit order to sell the security. But unlike at trailing stop ...
a) Limit Order 1 - Company X is trading at $40. The investor places a limit order to buy Company X if it drops to $35. b) Limit Order 2 - Company Y is trading at $42. The investor places a limit order to buy Company Y if it drops to $38. c) Limit Order 3 - Company Z is trading at $45.
Day orders are one of many ways that investors can keep trades under control, because they are a form of limit order. Day orders are actually rather long compared to other time limits investors can put on orders -- in some cases, orders can expire in as little as a few minutes.
How Does a One-Cancels-the-Other Order (OCO) Work? OCO orders are often used in online trading as a way to link a stop loss order (used to cut a loss) with a limit order (used to capture a gain). Once a stock hits a stop loss price target, there is no need for the other order to take profit on the same stock, or vice versa.
In other words, your stop-loss order is at $27 rather than the $8 in the first example. This helps investors lock in at least a portion of their gains during a rally. Positives and Negatives. The primary advantage of stop-loss orders is that they help limit losses.
He places an either-or order with the following trigger conditions: a) Limit Order 1 - Company X is trading at $40. The investor places a limit order to buy Company X if it drops to $35. b) Limit Order 2 - Company Y is trading at $42. The investor places a limit order to buy Company Y if it drops to $38. c) Limit Order 3 - Company Z is ...
Example of a Stop Order. For example, let's assume that you own 100 shares of Company XYZ stock, for which you have paid $10 per share. You are expecting the stock to hit $12 sometime in the next month, but you do not want to take a huge loss if the market turns the other way. You direct your broker to set a stop order at $8.50. If the stock ...