Markets · 6 pages · 12 min

How a stop order becomes something else when it triggers

A stop is a trigger that turns into a market order or a limit order once its price is hit.

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From the opening

A stop order waits armed, but it is not working as a bid or an offer, until a trigger price is reached. When the trigger happens, the stop becomes a different instruction, usually a market order or a limit order, and only that new instruction can trade. The opening covers the stop waits as a trigger, the trigger births a new order, and a market child takes the bids.

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Inside

The stop waits as a trigger
The trigger births a new order
A market child takes the bids
A stop-limit child may rest
Where the idea stops applying
A distinction worth keeping

Sources

Stop order as a trigger
Stop-market and stop-limit orders

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How a stop order becomes something else when it triggers

From the opening

Inside

Sources

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