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What Is a Stop Order?

By Benjamin LockeUpdated Sep 8, 2025 at 12:36 PM

Key Points

  • Stop orders automate buying/selling of stocks at set prices, limiting loss or securing profits.
  • Sell-stop orders trigger sales when stocks drop to protect gains; buy-stop orders engage on price rises.
  • Using stop orders can reduce emotional trading by setting predetermined entry and exit points.

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