SIE practice questionmediumOrder Types - Stop Orders
What triggers the activation of a stop order?
- AThe market price reaching the stop price✓ Correct answer
- BA change in interest rates
- CExpiration of the order
- DA limit price being hit
Explanation
Why A — The market price reaching the stop price
Stop orders become market orders when the market price hits the stop price. Interest rates and expiration are unrelated; limit orders are triggered by limit prices.
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