Stop and Stop Limit Orders

Stop and Stop Limit Orders

Stop and Stop Limit are conditional orders to buy or sell a security after certain criteria are met. eToro Options currently supports just sell Stop and sell Stop Limit orders, but we will outline both the buy and sell side below.

Sell Stops and Stop Limits

The sell Stop order is an order to sell once the price of the security meets (or drops to) your specified price, or the “stop price”. When your stop price is triggered, the Stop order will become a Market order and sell at the prevailing market price.

The Stop-Limit order, however, will trigger a Limit order instead of a Market order. Once the stop price is triggered, the order will become a Limit order to sell at your specified price or higher.

Buy Stops and Stop Limits

The buy Stop order is an order to buy once the price of the security rises to meet your specified “stop price”. When your stop price is triggered, the Stop order will become a Market order to buy at the prevailing market price.

The Stop-Limit order will trigger a Limit order instead of a Market order. Once the stop price is triggered, the order will become a Limit order to buy at your specified price or lower.

Things to consider

A Stop order may open you up to the risk of an unfavorable execution. This is especially true near the market open, in fast-moving markets, and in times of market volatility. The Stop Limit order, as with a Limit Order, is designed to provide you with price protection but may not result in an execution if the security cannot be bought or sold at your limit price. It’s important to consider these risk factors prior to placing a Stop or a Stop Limit order.