What Is A Stop Limit Order Example

A stop limit order is an order placed with a broker that combines the features of a stop order with those of a limit order.
What is a stop limit order example. 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. For example for an investor looking to buy a stock a limit order at 50 means buy this stock as soon as the price reaches 50 or lower. Say an hni is planning to buy 100 000 shares of alibaba. For example if a stock is priced at 100 a stop loss order may be placed by an investor at 75.
Stop limit order example an investor currently owns 100 shares of company abc. Combining the two we have the stop limit. Let s say you already own that 30 stock but expect it to decline. A sell stop limit order works in similar ways.
A stop limit order is an order to buy or sell a stock that combines the features of a stop order and a limit order once the stop price is reached a stop limit order becomes a limit order that will be executed at a specified price or. For example you might place a stop limit order to buy 1 000 shares of xyz up to 9 50 when the price hits 9. How limit and stop orders work a limit order is an instruction to the broker to trade a certain number shares at a specific price or better. The company s financial reports are due to be.
So if the price reaches or dips beneath 75 then this would trigger an automatic market sell order for the stocks that the investor. Similarly you can set a limit order to. A stop limit order will be executed at a specified. In this example 9 is the stop level which triggers a limit order of 9 50.
The shares are currently valued at 50 per share so the investment is worth a total of 5 000. If you put a stop price of 28 once it falls to that level your order is live. Limits only hit a specific number for example.