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Stop Limit

Stop Limit Explained A Stop Limit order is similar to a Stop Loss order that it allows you to limit your losses as well as protect gains on profitable positions. However, it allows for a specific limit price entry determined by the trader/investor.

Stop Limit A Stop Limit order will be executed at a specified price (or better) after a given stop price has been reached. Once the stop price is reached, the Stop Limit order becomes a limit order to buy (or sell) at the limit price or better.

What is a Stop Limit Order? Stop Limit Explained A Stop Limit combines a Stop order with a Limit order. A stop order is an order that is held until a specified price (stop price) is reached. When that price is reached, the sell order is automatically triggered as a limit order that is then sent to the exchange. At that point, the Limit order will remain active until the order executes (up to 30 days at a time). The investor is able to set the price at which the stock would be sold for; however, it is not guaranteed that the order will be fulfilled. Scotia iTRADE offers up to 30 days in the future to hold the order, after which the order will expire if not fulfilled. Stop Limit orders offer the advantage of providing protection against losses with an automatically executed order. This doesn’t require constant monitoring by the trader. When a trader uses a Stop Limit order, he or she is forced to consider the exit point before the price drops; allowing the trader to make the risk management decision with less emotion and more discipline.

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The stop limit order can be used for Canadian and US listed symbols. It can also be used to capture your gains.

Stop Limit Buy vs. Sell Stop Limit (Sell) Are orders that become booked limit orders when a board lot is traded at or below the trigger price on the marketplace to which the order has been booked.

Stop Limit (Buy) Are orders that become booked limit orders when a board lot is traded at or above the trigger price on the marketplace to which the order has been booked.

Stop Limit | Scotia iTRADE

EXAMPLE XYZ is trading at $13.00 and an investor wants to sell the stock once it begins to show some downward movement. The investor has put in a stop-limit order to sell with the stop price at $11.40 and the limit price at $11.30. If the price of XYZ moves below the $11.40 stop price, the order is activated and turns into a limit order. As long as the order can be filled at or above $11.30 (the limit price), the trade will be filled. If the stock gaps below $11.30, the order will not be filled.

Stop Price: 11.40

Limit Price: 11.30

*The above example is for educational purposes only and not to be interpreted as a recommendation.

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Stop Limit | Scotia iTRADE

How To Set A Stop Limit Order To set a Stop Limit order on Scotia OnLine®, begin by selecting your account. Fill in the trade ticket with the symbol, market, order type (sell), and quantity. Select price type and select ‘Stop Limit’ from the drop-down, and set your stop price, as well as your limit price. When you sell, the stop price is always higher than the limit price. Select a day sometime in the next 30 days to keep your order open for a while. Come back on a regular basis to adjust your stop price as the stock price moves up or down.  Select Price Type: Stop Limit  Set Stop Price  Set Limit Price  If stock hits Stop Price > order is activated; turns into a Limit Order  If trade can be filled above Limit Price, the security will be sold

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Stop Limit | Scotia iTRADE

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Scotia iTRADE® (Order-Execution Only Accounts) is a division of Scotia Capital Inc. ("SCI"). SCI is a member of the Investment Industry Regulatory Organization of Canada and the Canadian Investor Protection Fund. Scotia iTRADE does not provide investment advice or recommendations and investors are responsible for their own investment decisions. ®Registered trademark of The Bank of Nova Scotia. Used under license. © Scotia iTRADE 2014. All Rights Reserved.