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Reading 55: Market Organization and Structure-LOS g 习题精选

Session 13: Market Organization, Market Indices, and Market Efficiency
Reading 55: Market Organization and Structure

LOS g: Compare and contrast execution, validity, and clearing instructions.

 

 

Stop loss sell orders are:

A)
placed to protect a short position.
B)
executed on an uptick only.
C)
placed to protect the gains on a long position.


 

Stop loss sell orders are limit sell orders that are placed below market price. When the share price drops to the designated price, a sell order is executed protecting the investor from further declines.

An investor sold a stock short and is worried about rising prices. To protect himself from rising prices he would place a:

A)
limit order to buy.
B)
stop order to sell.
C)
stop order to buy.


A limit order to buy is placed below the current market price.

A limit order to sell is placed above the current market price.

A stop (loss) order to buy is placed above the current market price.

A stop (loss) order to sell is placed below the current market price.

A stop order becomes a market order if the price is hit.

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An order placed to protect a short position is called a:

A)
stop loss buy.
B)
stop loss sell.
C)
protective call.


A short position profits from declines in stock price and experiences losses as the price rises. A stop loss buy is a limit order that is placed above the market price. When the stock price reaches the stop price, the limit order is executed curtailing further loses.

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