buy stop order

Buy Stop Order

An order to buy a security which is entered in at a price above the current offering price. It is triggered when the market price touches or goes through the buy stop price.

Notes:

People using a buy stop hope to gain if momentum gains on a particular stock. If the price exceeds the price you have set, it will automatically trigger a market order.

See also: Stop Loss Order

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Buy stop order

A buy order not to be executed until the market price rises to the stop price. Once the security has broken through that price, the order is then treated as a market order. Also known as a suspended market order. Often used to protect against loss on a short sale.

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buy stop order

A customer's order to a broker to buy a security if it sells at or above a stipulated stop price. This type of stop order can be used to protect an existing profit or to limit the potential loss on a security that has been sold short. Compare sell stop order.