Limit order
An order that sets the highest purchase price or lowest sale price the investor will accept.
Plain languagePractical exampleConnected reading
01
What is it?
An order that sets the highest purchase price or lowest sale price the investor will accept.
02
Why does it matter?
It gives price control, but the order may not execute if the market never reaches the limit.
03
How should it be read?
Check the order book, liquidity, queue priority and time in force together.
04
Common mistake
Assuming the limit price guarantees execution.
A simple example
A buy limit at 100 can execute at 100 or lower when matching liquidity is available.