Question

The following orders exist for a particular stock:

1. Limit order: Buy 100 shares at 100.00

2. Limit order: Sell 100 shares at 102.00

3. Limit order: Buy 100 shares at 99.00

4. Sell stop order: Sell 100 shares at 97.50 on Stop

The quoted price for the stock proceeds as follows:

         101 at 102

         101.50 at 102.50

         100 at 101

         99 at 100

         98 at 99

         96 at 97

For each order above:

         When did it get filled (which quoted price)?

         At what price did it get filled?

Answer 1

1. Limit buy order is an order to buy a specified stock at the limit price or below it. The quoted price for this order is 99 at 100. It will get filled at 99.

2. Limit sell order is anorder to sell a specified stock at the limit price or above it . The quoted price for this order is 101.50 at 102.50. It will be filled at 102.50.

3. This order is same as the first one. The quoted price for this order is 98 at 99. The order will be filled at 98.

4. This is an order to sella specific stock if it falls below a specific stock price. The quoted price for this order is 96 at 97. This order is filled at 97 because, the investor would like to sell at higher price.