List of Financial Market Terms

A stop order is issued to buy or sell stock when price goes above or below a particular point.  This gives the Trader a greater probability of getting a predetermined entry or exit price, limits loss, or locks in his/her profits. Once the price rises above/falls below the predetermined entry/exit point, the stop order becomes a market order used by Traders in stock trading or options trading.

This is also referred to as a "stop" or "stop/loss" order.

Related terms: Protective Stop, Target, Trailing Stop, Avoid a Bull Trap, Avoid a Bear Trap

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