Match each standard order type on the left with its correct market placement rule and primary investor objective on the right.
- Buy Stop OrderPlaced above the current market price; used to limit potential losses on a short stock position or capture an upward breakout.
- Sell Limit OrderPlaced above the current market price; used to lock in profits on an existing long position at a target price or higher.
- Buy Limit OrderPlaced below the current market price; used to purchase stock at a specified price or lower.
- Sell Stop OrderPlaced below the current market price; used to protect against downside loss on an existing long stock position.
Cevap
Buy Stop Order matches with 'Placed above the current market price; used to limit potential losses on a short stock position or capture an upward breakout.' Sell Limit Order matches with 'Placed above the current market price; used to lock in profits on an existing long position at a target price or higher.' Buy Limit Order matches with 'Placed below the current market price; used to purchase stock at a specified price or lower.' Sell Stop Order matches with 'Placed below the current market price; used to protect against downside loss on an existing long stock position.'
Order placement rules are strictly governed by their relationship to the current market price. Orders placed above the current market price are Sell Limit (to lock in gains at or above a target price) and Buy Stop (to protect short positions or buy on upside breakouts). Orders placed below the current market price are Buy Limit (to acquire stock at or below a maximum desired price) and Sell Stop (to prevent further loss on a long position if the market drops).
Adım Adım Çözüm
Anahtar Kavram
Order Types and Placement Rules Relative to Market Price