How To Stop Loss Order A stop-loss order directs a broker to buy or sell a particular asset at a specified price if it reaches that prices. A stop-loss order should limit an investor loss on security holding. Setting a stop-loss order 12% below the price at which you purchased the asset, for example, will limit your loss to 9%. Assume you just gained Microsoft stock at a share price of $30. You immediately set an $28 stop-loss order after acquiring the stock. If the asset goes below $28, your shares will be sold at the current market price. Stop-limit orders like stop-loss orders, restrict the amount of money that may be lost. However, as their name suggests, the price they will execute is restrict. Two prices are stated in a stop-limit order the stop price, which changes the order to a sell order, and the limit price. Instead of a market order to sell, the sell order becomes a limit order that will only execute at the limit price (or better). What Are The ...
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