Limit price


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Limit price

Limit Price

1. The price above or below which one is willing or not willing to buy or sell a security. For example, one may wish to buy a stock if the price drops to $20 per share, hold if the price goes above $40, or sell at $30. Both cases represent limit prices. An investor tells his/her broker any applicable limit prices, by which the broker is required to abide.

2. A price of a product, especially a mass-produced product, sufficiently low so as to discourage new entry into that product's market. Monopolists set a limit price by increasing production to more than they otherwise need, which requires potential competitors to spend a greater amount in production in order to match the price. This renders competition unprofitable and maintains the monopolist's control of the market. The practice is illegal in most countries. See also: Antitrust.

limit price

The price specified by an investor for a limit order. With a limit order to buy, the price represents the highest price the investor will pay. The price of a limit order to sell represents the lowest price the investor will accept.

Limit price.

A limit price is the specific price at which you tell your stockbroker to execute a buy or sell order on a particular security.

If the transaction can be completed at that price, it goes through, but if that price is not available, no purchase or sale takes place.

The advantage of a limit order is that you won't pay more or sell for less than you want. Since your broker is monitoring the price, it is more likely that the trade will take place at the limit price than if you waited until the security reached that price to place your order.

The potential drawback of setting a limit price, which is also known as giving a limit order, is that the transaction may not take place in a fast market if the price of the security moves up or down quickly, passing the limit price.

References in periodicals archive ?
The Ettakatol caucus Chairman called the Prime Minister to take the necessary provisions to limit price rise, in order to protect the Tunisian citizen's purchasing power.
Prior to the new price improvements on limit orders, most traders experienced usual trading inconvenience that most of their limit entry orders always fill at the limit price even if the market price disparity approvingly through it.
It determined that Penguin, together with four other international publishers and Apple, may have contrived to limit price competition for e-books in the EU, in breach of EU competition rules.
The Ministry of Energy and Coal Industry and the National Joint Stock Company "Naftogaz of Ukraine" shall provide upon request of the National Commission for the State Regulation of Energy documents and materials necessary to adjust the limit price of natural gas.
We took early action to limit price rises and will continue to work closely with policy-makers to bear down on rising costs for consumers.
The joint procurement exercise, managed by asset management consultancy Elliot Johnson, will not only limit price increases for each, but will also help them to monitor the performance of their services.
Initiators of an RFFQ(TM) specify the issue, size, side, limit price and order time limit, with the option to display only a portion of the order quantity (similar to an "iceberg" order type).
supplies and large foreign stocks (particularly in China and Brazil) are expected to limit price increases.
In this scenario, the alternative predation rule yields the benefit that the incumbent charges a limit price of [p.
And the further production increases still in the pipeline on the Continent should limit price appreciation in this country.
Here the sell limit price is entered above the stock's current market price.
Finally, if you become aware that suppliers cooperate with each other to limit price or production choices, to divide markets or initiate boycotts or blacklists, you may be the victim of antitrust violations.