SIE practice questioneasyOrder Types
What is the main purpose of a stop-limit order?
- ATo trigger a limit order once a specified price is reached.✓ Correct answer
- BTo guarantee immediate execution.
- CTo guarantee execution at any price.
- DTo execute at the market opening.
Explanation
Why A — To trigger a limit order once a specified price is reached.
A stop-limit order becomes a limit order when the stop price is reached. It does not guarantee immediate execution or execution at any price, nor is it tied to the market opening.
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