Stop-Limit Order

Stop-Limit Order

A stop-limit order is an order to buy or sell a stock that combines the features of a stop order and a limit order.  Once the stop price is reached, a stop-limit order becomes a limit order that will be executed at a specified price (or better).  The benefit of a stop-limit order is that the investor can control the price at which the order can be executed.

To understand where and how an order you place with your broker is executed, you should read Trade Execution: What Every Investor Should Know.  For more information on the different types of orders you can place when you buy or sell a stock, please read our investor bulletin “Trading Basics”.

 

We have provided this information as a service to investors.  It is neither a legal interpretation nor a statement of SEC policy.  If you have questions concerning the meaning or application of a particular law or rule, please consult with an attorney who specializes in securities law.