Order for the purchase (sale) of one stock and the sale (purchase) of another stock at a stipulated price difference. Contingent order, swap.
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An order to a broker to buy a security and sell the same security, but only if the broker can achieve a certain price differential. For example, an investor may make a swap order to buy a certain number of shares of Stock X and sell the same number of shares, but only if the broker can sell them at $1 more per share. If the broker is unable to do this, then no part of the order is executed. A swap order is also called a switch order.
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See swap order.
Wall Street Words: An A to Z Guide to Investment Terms for Today's Investor by David L. Scott. Copyright © 2003 by Houghton Mifflin Company. Published by Houghton Mifflin Company. All rights reserved. All rights reserved.