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Limit Order  

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Limit order is used to specify the price at which a trader is prepared to buy or sell the stock. If trader places limit order to purchase the stock at 40 when the price is 45, the broker will not execute the transaction until the price is at or below 40.

Also, if the trader places a limit order to sell the stock at 40 when the price is 35, the broker will not execute the transaction until the price is at or above 40.

Related Terms: Market Order - Brokerage Account



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