CFA Practice Question
Nabil buys 100 shares of "take a chance technologies" stock at $20 per share and wants to limit his losses. He could place a ______ order to sell 100 shares at $15, good until cancelled.
A. stop
B. market
C. put
User Contributed Comments 8
| User | Comment |
|---|---|
| garachen | A limit order works as well |
| evica | That's exactly what I think too. |
| koushaku | Think Stop - Loss Limit - Profit |
| moose1969 | limit orders do not limit losses. only "stop loss" orders do. A limit order is an order to sell at or above the present market. |
| mtcfa | Stop: triggers on the way down for long positions and triggers on the way up for short positions. You "stop" the bleeding. A limit order is meant to buy low or sell high. |
| toto123 | limit... buys below current mkt price and lock in profits Stop... buy above current mkt price and limit ur loss |
| roxy143 | stop-loss, limit - profit |
| chris21Feb | If you place a limit order at $15, since you are selling cheaper than the current price, your order will be executed immediately, therefore you won't be trading at $15. |