Problem
Financial investing and trading
Use critical thinking to express the following questions
• How does a stop order differ from a limit order?
o Suppose that a given market accepts only market and limit orders.
o Which of these two order types are more likely to be placed by buy-side market participants? Why?
o Again, suppose that a given market accepts only market and limit orders.
o Which of these two order types are more likely to be placed by sell-side market participants? Why?
• What does an investor expect from her broker when she places a stop limit order with a stop price to buy at 100 and a limit price of 100.10?
o Why might an investor place such an order?