What is a stop-limit order?

A stop-limit order combines the features of both a limit and a stop order. A limit order is an order to buy or sell a certain security for a specific price. 1 One thing to keep in mind is that you cannot set a plain limit order to buy a stock above the market price because a better price is already available.

What is the difference between a stop price and a limit order?

In a regular stop order, if the price triggers the stop, a market order will be entered. If the order is a stop-limit, then a limit order will be placed conditional on the stop price being triggered. Thus, a stop-limit order will require both a stop price and a limit price, which may or may not be the same.

What is a sell-stop limit order?

Sell-stop limit orders are most often used when a trader wants to limit losses or protect a profit on a security they own. To do this, the trader will set a stop price (below the current market price) and limit price. If the security falls to the stop price, a limit order is executed and the security is sold at (or above) the limit price.

What is a trailing stop order?

A stop limit order is a combination of a stop order and a limit order. It is an order to initiate a limit order once a security reaches a stop price. A market order is an order to buy or sell a security at the best available price. A trailing stop order is a stop order that moves with the market price.