The difference between Stop Order and MIT order is basically on the placement of predetermined price that triggers its execution (i.e. “Stop Price” for Stop Order and “Trigger Price” for MIT Order) relative to the current market price of the security.
* For Sell order, the Stop Price for a Sell Stop Order is placed below the current market price of the security, whereas the Trigger Price for a Sell MIT Order is placed above the current market price of the security.
Note:
Sell Stop Order is a normally used for "Sell To Close” order, which is a order to sell to close the long position you previously entered.
Sell MIT Order is a normally used for “Sell To Open” order, which is a order to sell in order to open/enter a short position.
* For Buy order, the Stop Price for a Buy Stop Order is placed above the current market price of the security, whereas the Trigger Price for a Buy MIT Order is placed below the current market price of the security.
Note:
Buy Stop Order is a normally used for “Buy To Close” order, which is a order to buy to close the short position you previously entered.
Buy MIT Order is a normally used for “Buy To Open” order, which is a order to buy in order to open/enter a long position.
For the list of other types of order, go to: Types of Orders in Trading.
Related Topics:
* A Chance to Learn from World Class Trading Experts For FREE You Should Not Miss
* Options Trading Basic – Part 1
* Options Trading Basic – Part 2
* Learning Candlestick Charts
* Learning Charts Patterns
1 comments:
It helps to picture things in chart trading terms.
If you have a limit order and a bar touches it, it won't necessarily fire until someone on the ask matches your bid. So the bar could theoretically sit there on your limit line and do nothing, and run away from it a moment later.
MIT orders basically switch your price to the ask as soon as that bar touches it, so you close it immediately.
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