Buy Limit Order

Always Buy Stocks using Limit Orders!
Limit order lets you control the price you want for the stock. Your trade is only completely executed once the price you set for the stock has been met or is in an acceptable range.

Buying Stocks using Limit Orders
If a stock is trading at $50 you might place a limit order of $51 implying you don't want to buy the stock for more than $51 dollars. If the price of the stock when your order has been executed is at $50, then you will get that price. If the price has risen to $52, your order will not be processed until the price goes at or below $51 after which your bought order will be for around $51. Conversely, if you want to buy the stock at $48 you might place a limit buy order at $48 which will get executed as soon as the price drops at or below $48. If that doesn't happen your order will not be fulfilled.

Quick Scenario Form reference to use while Buying stocks using limit orders:
Click on How to Place a Stock Trade using Limit Orders? on the left menu to find out the actual steps involved in placing the limit-order!
Scenario A)
Current Stock price:$50
You want to buy the stock at the current price but don't want to buy it for more than $51 dollars(remember market orders can give you a slightly difference price than the current one while placing the order). So what do you do?

You place a limit buy order of $51!

When you hit the buy stock button either you will get the $50 price or something below $51. If the stock has risen to $51.5 by that time, your order will not be fulfilled until the stock price goes below $51. Normally, brokerage firms often provide you with an expiration option, e.g. your limit buy is good till the end of the day(after which your limit buying order, if it's still open will be cancelled)/or good until cancelled.
Scenario B)
Current Stock price:$50
You really want to buy the stock at $48. So what do you do?

You place a limit buy order of $48!

Now your limit buy order is open and the stock will be bought once the stock price goes at or below $48. You can control the expiration time of the limit buy order like above as well.




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