What is a stop quote

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Limit Order vs. Stop Order

what is a stop quote

A stop-on-quote order is an order to buy or sell a security when its price surpasses a particular point, limiting your loss or locking your profit.

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Most investors only use buy and sell orders, and there's nothing wrong with that. However, there are a number of other important broker orders that investors can use to sell stocks for better prices or reduce their risk. One lesser known order is a stop-limit-on-quote order, which is an order investors can use to limit losses or buy stocks only after they've reached a certain price. What is a stop-limit-on-quote order? A stop-limit-on-quote order is an order that an investor places with their broker, which combines both a stop-loss order and a limit order. What the stop-limit-on-quote order does is enable an investor to execute a trade at a specified price, or better, after the stock price has reached the investor's desired stop price. In a sense it's a two phase order as it is only executed by the broker after the stock has reached the investor's desired stop price, but like a limit order it will only be execute at that price or better.

Different types of orders allow you to be more specific about how you'd like your broker to fill your trades. When you place a limit order or stop order, you tell your broker you don't want the market price the current price at which a stock is trading ; instead, you want your order to be executed when the stock price moves in a certain direction. A limit order can be seen by the market; a stop order can't until it is triggered. The limit order is conditional on the stop price being triggered. A limit order is an order to buy or sell a stock for a specific price. However, you cannot set a plain limit order to buy a stock above the market price because a better price is already available.

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Rather than continuously monitor the price of stocks or other securities, investors can place a limit order or a stop order with their broker. These orders are instructions to execute trades when a stock price hits a certain level. A limit order is used to try to take advantage of a certain target price and can be used for both buy and sell orders. A limit order instructs the broker to trade a certain number of shares at a specific price or better. For buy orders, this means buy at the limit price or lower , and for sell limit orders, it means sell at the limit price or higher. A stop order, sometimes called a stop-loss order , is used to limit losses; it instructs the broker to execute a trade when a stock reaches a price beyond which the investor is unwilling to sustain losses.


Limit Order vs. Stop Order: What's the Difference?



4 thoughts on “What is a stop quote

  1. Many brokers now add the term "stop on quote" to their order types to make it clear that the stop order will only be triggered once a valid quoted.

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