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A buy stop order directs to an order in which a market buy order is placed on a security once it hits a pre-determined strike price.
What Is a Stop Order? A stop order is one of the three main order types you will encounter in the market: stop, market, and limit.
A limit order instructs your broker to fill your buy or sell order at a specific price or better. A stop order will activate a market order when a certain price has been met.
A sell stop order is not guaranteed to execute near your stop price. A stop order may also be used to buy. A buy stop order is entered at a stop price above the current market price (in essence, "stopping" the stock from getting away from you as it rises).
A buy-stop order is placing an order to buy a security at the market price, and the order gets activated only when the security price reaches the stop price specified in the order. It is used to reduce risk, limit the losses or protect the profit associated with a position.
In this article, we will discuss the intricacies of buy-stop orders, including strategies, pros and cons, and other key factors to consider.
A buy stop order represents a market order to buy shares at the next available ask price, if and when the last trade price increases to, or up through, the stop price. You should enter the stop price for a buy stop order above the current ask price; otherwise, it may trigger immediately.
What is a buy stop order? It tells your broker to buy a given stock once it hits a specific price (above the current price). When used carefully, these orders can help sharpen your trading...
Let's focus on the basics of how an order is placed, then three common order types: market orders, limit orders, and stop orders. First up: how an order is placed. When you select buy or sell, your order is sent to your broker, who attempts to fill it on the market.
A buy stop order is a type of pending order that instructs the broker to buy an instrument at the specified price or higher.