5 useful tips: How To Buy Stock Online

3. Limit Orders:

Similar to the above but with some difference, a limit order let you tell your online broker the price you are willing to take if you are selling stocks and also the price you are willing to pay if you are buying. And with limit orders, the order will execute only if your price is reached.

4. Stop Limit Orders:

Actually, stop limit orders,when buying stock online are known to be customizable. With stop limit orders, we can actually set the activation price. And then, when the price is hit, the order then turns into a limit order with the limit price we had already set.

5. Trailing Stops:

We need to know that regular limit orders are either executed (or they expire). Now, trailing stop orders are best explained to get around this problem. How? It is simply by letting us tell our broker to sell a stock if it falls by a certain number of points (or a percent).

For those of us who are buying and selling individual stocks, we should give this a nice thought. Yeah, trailing stops can be a very splendid idea if you are buying and selling individual stocks. Even before we buy a stock, we should already have an idea of how far we will let it fall before we cut the losses. For real, some investment professionals even suggest never letting a stock to fall more than 10 per cent below the price one paid. This sound like a good idea? Then a trailing stop might just work for you.

Remember: Look well before you leap; and having a competent mentor will just make you fine.