Everyone down here where you're trading in today we're going to go over what a stock will in the order is. A stop limit order is an order type that combines the features of both a stop and a limit order. So the way this order where it says the stop price will act as a trigger that then turns it into a limit order will be executed at the limit price or better. This order type most commonly used for entering breakout trades or for protecting a position while maintaining control over the prices you pay or sell at.

The main downside with the supplement order is it takes time to place because of the multiple prices you have to decide on and more importantly it can be jumped if this documents quickly or gaps over your limit price. which means your order could go unfilled and that would not be a good thing especially if you're trying to stop out of a losing position a way. So avoid getting order jump is by placing your limit price further away from your stop price which I'll go over more shortly. So let's look at some examples here say we wanted to buy some spies which we're looking at right now.

If they broke out above today's highs which is currently at 240 685 but you didn't want to pay more than 246 and 90 then we would place a buy stop limit order with a stop at 246 86 and the limit price at 246 and 90. So once they trade that your stop price at 2:46 86 it would trigger in the order return into a buy limit at 246 and 90 so you would only get filled at that price or lower on buy stop limit orders. The stop price is usually placed lower than the limit price so we have a four cent difference from our stop price and our limit price which is way more than enough on a super liquid security. Like the Spies but say you're a trading a fast-moving stock with less liquidity then you would want to look at placing or your limit price further away like 7 or 8 cents depending on the stock.

You can always get a good idea on how far we replace it by looking at how big the spread is. So say if the stock has a 10-cent spread and you only have a 1 cent cushion between your stock and limit price then the likelihood of you get and it Phil is very low. So now let's look at the if we were going to place a sell stop limit order with the sell stop limit order. usually place the stop price above the limit and this example say we were long as buys but want to get out if it breaks the lows here at Two Forty Six Twenty eight.

So what we would do is place the sell stop at Two Forty Six Twenty Eight and say we didn't want to sell it if it got below you know to 46 25. So our limit order would be to 46 25. and our stop price would be to 46:28 to stop. So it would Once it trades down to our stop, it would trigger and only sell above our limit price of 246 25.

So that's how you kind of control your stop losses. Now some good things about Supplement Words is they provide a way to control the prices you get in and out. of. The major drawback with a stop limit order is there's a possibility your order can get jumped in a fast moving stock or if a gas over your limit price.

and there's ways that you know placing your limit price further away from your stop. But then you're giving up more room to for slippage. So it really depends on how bad you want to get in the stock and how much slippage you're willing to take. Alright, well that's it for your stop limit orders everyone.

if you have any questions, leave us a message in the comments below. See you guys next time. Oh hey, I didn't see you there while I was just working on the dream board for my next home run trade. Hopefully it comes soon.

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