Sunday, February 21, 2010
Conditional / Contingent Order – Part 2: Examples
Go back to Part 1: How It Works.Examples of Conditional / Contingent Orders:Example 1:Stock XYZ has been trading in a range between $30.00 and $35.00. You want to place a buy order to buy the shares of XYZ when the stock has broken out the range and show upward price movement. You can place a contingent order and set a condition that when the price is trading at $35.20 or above (Trigger Price >= $35.20), place an order to buy XYZ at $35.30 (i.e. Limit Order with Limit Price $35.30).Suppose when the market opens the next day, XYZ opens at $35.25,...