SIE practice questionmediumOrder Types
A stop order to sell is usually placed at a price:
- AExactly at the current market price
- BAbove the current market price
- CBelow the current market price✓ Correct answer
- DRegardless of market price
Explanation
Why C — Below the current market price
Sell stop orders are set below market to protect against further declines. Buy stop orders are set above market. Setting at the market price or regardless of price misses the stop order’s protective function.
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