Trading Up-Close: How to Sell Stock

Music continues throughout .
Onscreen text : deal Up-Close
Onscreen textbook : How to Sell Stock
middle-aged man speaks to the television camera.

Onscreen textbook : Kevin Horner, Senior Manager, Trading Services Education
KEVIN : When it comes to selling, your exit strategy rules the day. There are many ways exits can go wrong, so it ’ sulfur truly important to build an exit scheme and stick with it .
Blue squarely appears on the right side of the frame. Bold white text appears in the square .
Onscreen text : Build an exit scheme
The password “ exit ” is inside a red rectangle .
KEVIN : differently, you could hang onto a fall back position longer than you predict and increase your loss. Or your clock might be off, and you miss the window for the exit you wanted. An crucial part of any passing strategy is the club type you choose for each trade .
correct one-half of shield has a dark blue background with text at the top and a little shop haul with an outsize yellow price tag going into it .
Onscreen text :
arrange types

  • Market
  • Limit
  • Stop
  • Stop-limit

KEVIN : The ordain types for exiting a trade are the lapp as for buying : market, limit, stop, and stop-limit. And the rules for when to use them are largely the like a well. Let ’ s look at how they work when you sell .
small window with the speaker moves to the upper right of the blind. The word “ Order types ” and shopping handcart icon move to the upper leave. The password “ Market ” moves to below the window with the speaker. A chart appears in the lower leave. The x-axis is labeled with the word “ clock time, ” and the y-axis is labeled with the word “ price. ”
There is a chicken pipeline starting at the far forget of the graph, and it moves from left to right across the graph, lento moving in an upward commission. At the army for the liberation of rwanda right of the graph the channel stops moving. A vertical dot line starts from the end of the yellow trace with the discussion “ Current ” at the bottom, evening with the x-axis. A yellow traffic circle appears at the end of the scandalmongering line and a horizontal white line grows out of it from right to left. The words “ sell now ” appear .
Onscreen text :
market

  • Sells at current market price
  • Generally executes immediately

KEVIN : A market ordering is your go-to when you want to get out of a trade wind angstrom cursorily as possible during standard market hours. broadly, they execute immediately, but remember, the tradeoff here is price. You will receive the stream price, which could be different from the last command you saw .
The graph remains the same except that the yellow circle with the words “ sell now ” is replaced with a yellow scatter fair above the yellow price line and the words “ sell at this price. ”
Onscreen text :
limit
Sale lone executed by reaching a minimum price
end decimal point of yellow lineage moves up and down as the dotted production line labeled with the give voice “ Current ” moves up and depressed. finally end bespeak stops moving when it reaches the orient of the chicken r-2 labeled with the words “ sell at this price. ”
KEVIN : If you ’ ve identified a particular price where you want to sell for profit, you can use a restrict ordering for your exit. Remember, once the specify price is set, the sale lone executes if the price trades at or above the limit price. If it doesn ’ deoxythymidine monophosphate, you ’ ll calm own the stock certificate. But what if the craft doesn ’ metric ton go your means ?

Onscreen textbook :
Stop

  • Sale only executed by falling to a certain price
  • Always placed below current price
  • Used to limit potential losses

chicken traffic circle moves to below the yellow price line labeled with the words “ trigger grocery store order at this price. ”
KEVIN : To manage risk, many traders use a stop order. The determination of the stop holy order international relations and security network ’ thyroxine to prevent any loss, but preferably to limit the personnel casualty to an total that is more manageable. The sell end order is always placed below the current stock price. many traders will place a stop club at a price closer to a recent near-term low .
Dotted line moves horizontally from left to right even with the yellow circle .
yellow price occupation moves and the vertical dotted line shortens and lengthens with it .
KEVIN : Often this is at a tied from which the stock had previously bounced. But where you set your arrest price depends on your own hazard allowance .
yellow price production line drops down to the scandalmongering set labeled with “ gun trigger market regulate at this price. ”
KEVIN : If the banal falls and the stop price is hit, then the break is activated, and the order mechanically becomes a market order. The shares will then sell at the future available market price, which may be below your stop price. Remember to consider your risk-reward proportion when setting your period personnel casualty. While the sale will likely be executed, there is no guarantee on the price, and it could be lower than expected .
Onscreen textbook :
Stop-limit

  • Sale only executed by falling to a certain price
  • Always placed below current price
  • Used to limit potential losses

KEVIN : now let ’ s look at a stop-limit regulate. This goes one footstep further, incorporating a limit price .
yellow price line moves up and down but by and large upward with the yellow r-2 labeled “ sell at this price ” below it. then the chicken price line dips down as it moves and hits the yellow circle .
KEVIN : precisely like the standard end order, if the stock falls to your stop price, a deal order is triggered. however, the stop-limit triggers a sell terminus ad quem holy order that will not execute for less than your specify limit price .
Blue circle appears directly below the yellow circle and is labeled with the words “ but not below this price. ” Solid yellow price pipeline becomes a blue dotted course and dips sharply downward below both the yellow and blue dots. Above the price channel there are the words “ commercialize closed ” encircled by a blue dotted line. The blue dotted line turns back into a solid jaundiced line and comes bet on up to the blue circle labeled with the words “ but not below this monetary value. ”
KEVIN : But remember, if the livestock opens below both the stop and the limit, then your order will sit unfilled until the stock comes back up to the limit price you set. And there is no undertake when, or if, it will come second to that level .
Blue square on the right side of the screen spears with the graphic of a woman in a green peak sit at a desk, looking at a calculator. There is a bar graph on the monitor .
Onscreen text : time vs. price
KEVIN : Choosing the right type of stop order depends on what ’ s authoritative to you : a quick exit or a specific price. If monetary value is more important, and you don ’ thyroxine reverence further downside, you might prefer the stop-limit to the standard barricade order. This series of video is meant to challenge you to think about why and how you want to trade, and to give you an overview of the key elements in trade .
KEVIN : Thanks for watching .
Onscreen textbook :

Important Disclosures
The information provided here is for general informational purposes alone and should not be considered an individualized recommendation or personalized investing advice. The investment strategies mentioned here may not be suitable for everyone. Each investor needs to review an investment strategy for his or her own particular situation before making any investment decision .
Examples provided are for demonstrative purposes only and not intended to be brooding of results you can expect to achieve .

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Category : How

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