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Started By
Message
Dumb question
Posted on 3/13/24 at 6:27 pm
Posted on 3/13/24 at 6:27 pm
New to stocks
I have a stock that has gone up a lot
I want to protect myself
Let’s say the stock is $100 and I want to sell it if it goes to 80
How do I automatically do that ?
I’m with Charles Schwab
I see my sell options as
Limit
Stop
Stop limit
Trailing stop
What’s the difference in stop and stop limit ?
Which option do I choose ?
Thanks
I have a stock that has gone up a lot
I want to protect myself
Let’s say the stock is $100 and I want to sell it if it goes to 80
How do I automatically do that ?
I’m with Charles Schwab
I see my sell options as
Limit
Stop
Stop limit
Trailing stop
What’s the difference in stop and stop limit ?
Which option do I choose ?
Thanks
Posted on 3/13/24 at 6:30 pm to Baylor
Let me make myself clear from the OP
I don’t want to sell right now
I just want to auto sell it if it gets down to a certain point
If it keeps going up just gonna let it ride
I don’t want to sell right now
I just want to auto sell it if it gets down to a certain point
If it keeps going up just gonna let it ride
Posted on 3/13/24 at 6:37 pm to Baylor
use a stop. stop limit will sell if it goes below your stop and sell if it goes above your limit
Posted on 3/13/24 at 7:25 pm to Baylor
Sell stop, sometimes shown as stop or stop market. It’s an order such that if hit, converts to a market sell order.
Posted on 3/14/24 at 8:32 am to Baylor
A trailing stop may also interest you.
This is a stop order that automatically adjusts based on the peak stock price.
So in your example, if the stock is currently $100 and you set a trailing stop for $20 it will have a sell order that activates at $80.
However, if the price rises to $110, that sell target automatically adjusts to $90. $20 below the highest price after you put the order in.
Important to note, when setting a stop order you enter the target price ($80). When setting a trailing stop, you enter the amount you want it to drop before selling (so $20 for your example).
To answer that question, a stop order as described will trigger a market sell order once the stock price drops to your stop price ($80). It is a market order so it will sell all of the shares you have told it to no matter what price it has to drop to in order to execute.
A stop limit will act in the same way, but the 'limit' price you set will tell it not to sell anything below that limit price (essentially the lowest price you're willing to sell for). So, if your 'stop limit' stop price is set at $80 in your example, and you set the limit price to $75, once the stock drops to $80 the order will sell as much of your stock as it can until the market price drops below $75 then it will no longer sell until it rises back above $75 (or the order is cancelled).
This is a stop order that automatically adjusts based on the peak stock price.
So in your example, if the stock is currently $100 and you set a trailing stop for $20 it will have a sell order that activates at $80.
However, if the price rises to $110, that sell target automatically adjusts to $90. $20 below the highest price after you put the order in.
Important to note, when setting a stop order you enter the target price ($80). When setting a trailing stop, you enter the amount you want it to drop before selling (so $20 for your example).
quote:
What’s the difference in stop and stop limit ?
To answer that question, a stop order as described will trigger a market sell order once the stock price drops to your stop price ($80). It is a market order so it will sell all of the shares you have told it to no matter what price it has to drop to in order to execute.
A stop limit will act in the same way, but the 'limit' price you set will tell it not to sell anything below that limit price (essentially the lowest price you're willing to sell for). So, if your 'stop limit' stop price is set at $80 in your example, and you set the limit price to $75, once the stock drops to $80 the order will sell as much of your stock as it can until the market price drops below $75 then it will no longer sell until it rises back above $75 (or the order is cancelled).
This post was edited on 3/14/24 at 8:35 am
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