# Limit order

## Limit order

An order to buy a stock at or below a specified price, or to sell a stock at or above a specified price. For instance, you could tell a broker "buy me 100 shares of XYZ Corp at \$8 or less" or "sell 100 shares of XYZ at \$10 or better" The customer specifies a price, and the order can be executed only if the market reaches or betters that price. A conditional trading order designed to avoid the danger of adverse unexpected price changes.

## Limit Order

An order to a broker to buy or sell a security at a certain price. That is, a limit order is not an immediate order; rather, it orders the broker to hold the security until the desired price is reached. For example, if stock A is trading at \$50 per share, an investor may give his/her broker an order to buy stock A at \$35 per share. The limit order may have a time limit on it, or it may remain open until filled. It is also called simply a limit.

## limit order

An order to execute a transaction only at a specified price (the limit) or better. A limit order to buy would be at the limit or lower, and a limit order to sell would be at the limit or higher. Limit orders are used by investors who have decided on the price at which they are willing to trade. Compare market order. See also elect, or better, stop order.

## Limit order.

A limit order sets the maximum you will pay for a security or the minimum you are willing to accept on a particular transaction.

For example, if you place a limit order to buy a certain stock at \$25 a share when its current market price is \$28, your broker will not buy the stock until its share price reaches \$25.

Similarly, if you give a limit order to sell at \$25 when the stock is trading at \$20, the order will be filled only if the price rises to \$25.

A limit order differs from a market order, which is executed at the current price regardless of what that price is. It also differs from a stop order, which becomes a market order when the stop price is reached and the order is executed at the best available price.

References in periodicals archive ?
Dealer markets typically feature much lower levels of transparency than limit order markets.
Panchapagesan, 2005, "The information content of the limit order book: evidence from NYSE specialist trading decisions", Journal of Financial Markets, 8:25-67
Highland Council officials are now searching for a speed limit order in their dusty archives.
With fractional pricing, an investor using a limit order specified prices in 6.25 [cts.] increments.
In light of these judgments, I would caution against the implementation of a government mandate for any particular form of central limit order book.
In an auction market an investor buys or sells at a price set by another investor's limit order. A limit buy order specifies the maximum price that an investor is willing to pay, whereas a limit sell order specifies the minimum price that an investor is willing to receive.
For NYSE spreads set by limit orders, a basis for the fragmentation hypothesis is that increases in off board trading volume, for a given total volume, reduce NYSE trading volume, which may increase NYSE spreads if the total limit order flow to the NYSE is reduced.
investor who wants to trade shares of a Japanese ETF can limit the potential volatility of that move by using a limit order for the trade.
Lowprice then posts a new 1,000-share sell limit order for IBM on EDGE for \$161.13.
The LMAX Exchange open order book is driven by streaming, firm limit order liquidity supplied by the leading global financial institutions.
THE A77 TRUNK ROAD (MAYBOLE) (30MPH, 20MPH AND PART-TIME 20MPH SPEED LIMIT) ORDER 2014 THE SCOTTISH MINISTERS give notice that they propose to make the above speed limit Order under sections 82(2)(a) and (b), 83(1), 84(1)(a) and (c) and 124(1)(d) of and paragraph 27 of Schedule 9 to the Road Traffic Regulation Act 1984.
A limit order lets you specify a maximum price at which you're willing to buy or a minimum price for a sale, giving you more control over the trade.

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