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Bubba owns 100 shares of XYZ at $58. He needs to limit his loss to 5 points or less and will accept a longer time for the order to be executed, to make sure the loss does not exceed 5 points.
Which of the following orders would be the best recommendation?
Suggested Answer: B
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balance sheet. This report reflects the entire condition of the company by showing all assets, liabilities, and components of net worth.
38 comments · newest first
GW
Gwenn
11 months ago
Bubba's shares are at $58, needs to limit loss to $53.
EL
Elfrieda
11 months ago
Wait, can a stop order really protect against losses like that?
GR
Gracia
12 months ago
A sell limit order won't help here.
AL
Alexia
12 months ago
I disagree, B could work too.
AN
Anastacia
1 year ago
C is the best choice to limit losses.
SU
Sunny
1 year ago
I’m confused about the difference between a stop order and a stop-limit order. I hope I remember the right one for this scenario!
AL
Alberto
1 year ago
I practiced a similar question where a sell stop order was recommended to protect against losses. I feel like that could apply here too.
JA
Janine
1 year ago
I'm not entirely sure, but I remember something about stop-limit orders being tricky. They might not execute if the price drops too quickly.
LU
Lucy
1 year ago
I think a sell stop order might be the best choice here since it triggers when the price drops to a certain level, which helps limit losses.
LA
Laquanda
1 year ago
I'm leaning towards B as well, the sell stop-limit order. It gives Bubba the flexibility to manage his risk while still trying to get a decent price for the shares.
LE
Lemuel
1 year ago
Okay, I've got it. Since Bubba wants to limit his loss, the best option would be a sell stop-limit order. That way, he can set the stop price to $53 (58 - 5) and the limit price to ensure the order only executes at that price or better.
CR
Cruz
1 year ago
Hmm, I'm a bit confused here. Bubba owns 100 shares of XYZ, but the question doesn't specify whether he wants to buy or sell. I'll need to think this through carefully.
CH
Cheryl
1 year ago
This looks like a straightforward question on order types. I think the key is to focus on Bubba's requirement to limit his loss to 5 points or less.
FA
Fairy
1 year ago
I'm pretty confident the answer is B, sell stop-limit order. That allows Bubba to control the maximum loss while still getting the best possible price.
FR
Frederick
1 year ago
Ah, I think I've got it! The Verify Scope process would need the Project management plan as an input to confirm the approved scope. That's my best guess.
JA
Jaime
1 year ago
Okay, I think I've got this. The key is to focus on getting the requirements validated and approved by the customer before development starts. That's the most important first step.
GE
Gerry
2 years ago
Back in my day, we just used a good old-fashioned paper bag to limit our losses. These fancy trading orders are making my head spin!
MO
Monte
1 year ago
D) buy stop order
SC
Scot
1 year ago
C) sell stop order
LI
Lisbeth
1 year ago
B) sell stop-limit order
BR
Brittney
1 year ago
C) sell stop order
BA
Barrett
1 year ago
B) sell stop-limit order
ER
Erinn
1 year ago
A) sell limit order
IV
Ivan
2 years ago
A) sell limit order
CH
Christa
2 years ago
Hold up, why would anyone choose a buy stop order in this situation? That's just asking to lose more money than necessary.
PI
Pilar
2 years ago
I'm going with the sell limit order. That way, I can control the price at which my shares are sold, and still limit my loss to 5 points.
EL
Elise
2 years ago
I'm not sure, but I think a sell stop order could also work to limit the loss for Bubba.
AH
Ahmad
2 years ago
Hmm, a sell stop order seems like the way to go. It'll execute the trade as soon as the price hits my stop, which is exactly what I need to protect my investment.
KR
Kristeen
1 year ago
User 2: I agree, that way you can protect your investment and limit your loss to 5 points.
TH
Theodora
1 year ago
User 1: I think a sell stop order would be best. It will execute the trade as soon as the price hits your stop.
DE
Devorah
1 year ago
User 2: Yeah, that way you can protect your investment by executing the trade as soon as the price hits your stop.
LE
Leeann
2 years ago
User 1: I think a sell stop order would be the best choice.
LA
Lang
2 years ago
I agree with Tatum. A sell stop-limit order would help Bubba limit his loss to 5 points or less.
RO
Ronald
2 years ago
As a certified trader, I know that a sell stop-limit order would be the best choice here to limit my loss to 5 points or less.
TA
Tatum
2 years ago
I think the best recommendation would be a sell stop-limit order.
LA
Lauryn
2 years ago
I think a sell stop order could also work, as it would trigger a sale when the price reaches a certain point to limit the loss.
FE
Fernanda
2 years ago
I agree with Dana. A sell stop-limit order would help Bubba limit his loss to 5 points or less.
DA
Dana
2 years ago
I think the best recommendation would be a sell stop-limit order.