Acover order combines a market order or limit order with a stop loss order, ensuring that the maximum potential loss is known in advance if the trade moves against the trader. The purpose of cover orders is to reduce the risk for both the broker and the trader while also allowing the trader to leverage their positions more effectively. A cover Lets say you have set the trigger price at Rs. 105 and the limit price at Rs. 106 (for a buy stop-loss limit order, the trigger price is less than or equal to the limit price ). Hence, when the market price reaches Rs. 105, the buy limit order will be activated, and your order will get executed at the next available ask/offer below Rs. 106. Abuy limit order is an order to purchase an asset at or below a specified price. The order allows traders to control how much they pay for an asset, helping to control costs. Theseare the mirror opposite of buy stops and buy limits. A sell stop is an order that is placed below the current market price, meanwhile, a sell limit is an order placed above the current price. Both of these orders are used for shorting. If support breaks we're using sell stop orders to catch a decline as in the graphic below. Thebenefit is that a stop-market order may help get the investor out of the falling position quickly. The risk is that the next available price could be lower than what the investor anticipated. If the investor uses a stop-limit order, when the stock falls to the stop price, it'll trigger an order that seeks to fill at the limit price or better. Whenshould I use a Buy Stop Limit? A Buy Stop Limit is for when you predict a temporary fall in price, followed by an upswing. It can help you to: Get your orders filled at better prices; Manage your investment risk, while you're away from your trading screen; Control the timing of your orders, and price at which they're filled LfKjrjX.

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