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Order contingent on price - Investors also may place orders specifying prices at which they are willing to buy or sell a security. -Limit buy-sell orders - An order specifying a price at which an investor is willing to buy or sell a security. -Limit-sell – instruct the broker to sell if and when the stock price rises above a specified limit. -Limit-buy- instructs the broker to buy some number of shares if and when they be obtainedat or below a stipulated price. A collection of limit orders waiting to be executed are called alimit order book. Stop order- Trade is not to be executed unless stock hits a price limit -Stop-loss orders- the stock is only to be sold if its price falls below a stipulated level. -Stop-buy orders- stop-buy orders specify that a stock should be bought when its price rises above a limit. These trades are often accompanied by short sales ( sales of securities you do not own but have borrowed from your broker) and are used to limit potential losses from the short position. ConditionPrice falls below limitPrice rises above the limit-
BuyLimit buy orderStop-buy order-SellStop-loss orderLimit sell order --Discretionary order : gives the broker the power to buy and sell for your account at the brokers discretion. Time dimension on order (other than market orders)-IOC: immediate or cancelDay: by defaultGTC: good until canceled usually 60 days maximum Us Securities Markets OverviewNASDAQ-dealer market is a market without centralized order flow-largest organized stock market for OTC trading: information system for individuals , brokers and dealers-Securities: stocks, most bonds and some derivatives Nasdaq national marketTable 3.1 partial requirements for listing on Nasdaq markets Small Stock OTC – pink sheetsOrganized exchanges1.NYSE2.ASE3.RegionalsElectronic Communication Networks (ECNs)National Market System OTC Markets - An informal network of brokers and dealers who negotiate sales of securities. NASDAQ