Tobbaco

[jassielarry]

When dealing with investments, you have five main ways to buy or sell them online:

Market orders: This is the most common type of order. You tell your broker to sell your shares at the best price or to buy shares at the current price. Because these orders are executed almost immediately and are straightforward, they typically have the lowest commissions.

Limit orders: With a limit order, you tell your online broker the price you’re willing to take if you’re selling stocks and the price you’re willing to pay if you’re buying. The order will execute only if your price is reached.

Limit orders are filled only at the price you set. If the stock falls further than the price you set, the broker might be able to sell only some of the shares, or none, at the price you set.

Stop market orders: Similar to limit orders stop market orders let you set a price you want to buy or sell shares at. When a stock hits the price you designated, the order converts into a market order and executes immediately.

Stop limit orders: Stop limit orders are customizable. First, you can set the activation price. When the price is hit, the order turns into a limit order with the limit price you’ve set.

Trailing stops: Regular limit orders are either executed or they expire. Trailing stop orders get around this problem by letting you tell your broker to sell a stock if it falls by a certain number of points or a percentage.

If you’re buying and selling individual stocks, trailing stops can be a good idea. Even before you buy a stock, you should have an idea of how far you’ll let it fall before you cut your losses. Some investment professionals suggest never letting a stock fall more than 10 percent below the price you paid. If this sounds like a good idea to you, a trailing stop could work for you.

Some brokers charge extra for limit orders, so check the commission fees before you start trading.

When you enter an order for a stock, you have a few other levers you can pull, including

Designating lots: Many people buy the same stock many times. Each time you buy, that bundle of stock is called a lot. When you sell, your broker will assume you’d like to sell the lot that you’ve held for the longest time for recordkeeping purposes. If, for tax reasons, you’d like to sell a specific lot that’s not the oldest, you can tell your broker which lot you’d like to sell.

Setting time frames: You can enter an order for a stock that is active only for the day you place the trade. If it’s not filled the order expires. You can also enter orders and let them stay active until you cancel them.

Placing rules: When you issue an “all or none” restriction on your trade, your broker must completely fill the order or not fill it at all.