FIN 100 Strayer University Difference Between Market Limit and Stop Loss Ques

User Generated

ivpgbenagubal

Economics

FIN 100

Strayer University

FIN

Description

  1. Describe the differences among the following three types of orders: market, limit, and stop loss. Provide examples of each in your own words.
  2. What is a short sale of stock? Provide an example in your own words.
    • Use your textbook to define the term short sale as it pertains to stock.
  3. Describe buying on margin. Provide an example in your own words.
  4. Why is it illegal to trade on insider information? Provide an example in your own words.

Note: Write responses and definitions in your own words—do not copy and paste from the Internet. Use the attached template for this assignment.


Unformatted Attachment Preview

***This is a template. Please type over/delete all items in red prior to submitting your assignment. Week 7 Homework: Definitions By Type Your Name Here FIN100: Principles of Finance Enter the Name of Your Instructor Here Type the Date Here (ex. February 10, 2020) Week 7 Homework Instructions: Please respond to the following questions: 1. Describe the differences among the following three types of orders: market, limit, and stop loss. Provide examples of each in your own words. Your Answer: 2. What is a short sale? Provide an example in your own words. Your Answer: 3. Describe buying on margin. Provide an example in your own words. Your Answer: 4. Why is it illegal to trade on insider information? Provide an example in your own words. Your Answer: *AFTER COMPLETING YOUR WORK, DELETE ALL ITEMS IN RED. Your font must be black. 2 Sources Sample formatting for an online source: 1. Anya Kamenetz. July 10, 2015. The Writing Assignment That Changes Lives. https://www.npr.org/sections/ed/2015/07/10/419202925/the-writing-assignment-thatchanges-lives Please provide your source list below: 1. Website 1 2. Website 2 3. Website 3 3
Purchase answer to see full attachment
User generated content is uploaded by users for the purposes of learning and should be used following Studypool's honor code & terms of service.

Explanation & Answer

Please view explanation and answer below.

Week 7 Homework: Definitions
By Type Your Name Here
FIN100: Principles of Finance
Enter the Name of Your Instructor Here
Type the Date Here (ex. February 10, 2020)

Week 7 Homework
Instructions: Please respond to the following questions:

1. Describe the differences among the following three types of orders: market,
limit, and stop loss. Provide examples of each in your own words.
A market order is the simplest and most common type of order and is used to buy
or sell a security instantly. It offers assurance about the execution of the order. However,
it offers no assurance about the order’s execution price. This means that the risk of the
price going under or above one's desired price is a possibility and that what one gets may
be less than what was recorded in the order that they filled (U.S. Securities and Exchange
Commission,1). For example, let us assume that the current price of company A's shares is
$150. If a trader wants to buy or sell as soon as possible, they will use a market order. The
stock will be sold or purchased immediately at the prevailing trading price.
On the other hand, a limit order facilitates the sale or purchase of a security at a
specific price. Limit orders are considered to be the best way to trade. For a buy limit trade,
a security is only bought when its price is equal to or lower than the set price, while for a
sale limit trade, the security is only sold at the limit price or a higher value (U.S. Securities
and Exchange Commission, 1). For example, if a trader wants to buy company A's sha...


Anonymous
Awesome! Perfect study aid.

Studypool
4.7
Trustpilot
4.5
Sitejabber
4.4

Related Tags