Can anyone explain the following terms? I’m confused right now. 1. limit buy 2. limit sell 3. stop loss buy 4. stop loss sell
- Limit Buy - is the limit order you place in order to buy a stock at a lower than prevaling market value. So it becomes a market order, the moment the trigger price is reached 2. Limit Sell - is the same concept, you place in order to sell the stock once it reaches certain trigger price. 3. Stop Loss Buy - This is used when you have short sold a stock and need to cover the long position, you are scared that the price of the stock would go to high, so you place this order to buy the stock and cover your short position 4. Stop Loss Sell - exactly opp of 3 EDIT: hope I didn’t mess up even more for you…
Right so a Stop loss buy is an order placed above the current market price to buy the stock and cover the short. If the market price reaches the order price, the order becomes a market order and is done at whatever the market price is.
how is limit sell different from short loss sell? i find it pretty much the same? what should i look out for to tell the difference?
1 & 2 do not become market orders because that would imply you are willing to pay any price. With a limit, you are only willing to pay the limit price.
mystically Wrote: ------------------------------------------------------- > how is limit sell different from short loss sell? > i find it pretty much the same? what should i look > out for to tell the difference? A “short loss sell” is not a standard order type that I have ever heard of…
sorry i meant stop loss sell…haha
Stop loss sell is to protect a long position so it becomes a market order when price drops to trigger point.