I am totally confused about StoP and Limit Orders. I have visited so many websites that I can say the definitions backwards. Please just explain in simplest possible words the difference between the two orders if at all there is any difference. Limit Order I think is easier to understand whereas Stop Order is freaking me out. I have read numerous threads on Yahoo with the same example "If you own ABC stock and place a Stop Order at $90.00, your stock will be sold the moment it drops below 90. What kind of moron would want to sell his/her stock at a lower price? Why would I wait for the prices to fall below a certain point to sell my stock? Won't it increase my losses? Woudn't anyone want to sell the stock when the price is right?Based on the above, I guess the same moron may place a Limit Order to buy stock if the price climbs above a certain point. It doesn't make any sense.Since Stop Orders are so complicated, I have not even glanced at Stop Limit Order yet. PLEASE HELP!!
2007-08-24
16:55:46
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4 answers
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asked by
iNsUrEdByMaFiA
2
in
Business & Finance
➔ Investing