Financial Glossary
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Buy Stop Order
- An order to buy a security which is entered at a price above the current offering price. It is triggered when the market price touches or goes through the buy stop price.
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Soft Stop Order
- A mental price or percentage set by traders where they will place a buy or sell order. A soft stop order is a position set by traders where they should buy or sell a security, however it is "soft" because it can be manipulated or changed depending on market conditions and special circumstances.
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Stop Order
- An order to buy or sell a security when its price surpasses a particular point, thus ensuring a greater probability of achieving a predetermined entry or exit price, limiting the investor's loss or locking in his or her profit. Once the price surpasses the predefined entry/exit point, the stop order becomes a market order.
Also referred to as a "stop" and/or "stop-loss order".
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