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Question

What is a Stop Order?

Answer

A Stop Order to sell, otherwise known as a Stop Loss order, is an instruction to sell shares at the prevailing market price but only if a price specified by you, your stop price, has been reached or passed.

To gain added protection over the price at which your order is dealt you can specify a limit price as part of your Stop Order to sell, in which case shares will only be sold at a price which is between your stop and limit price, inclusive. Setting a limit price is optional. Stop Orders are triggered on the basis of prices quoted by the LSE. The price at which a Stop Order may actually be dealt could be different to the LSE price due to the benefits of Barclays Stockbrokers Price Improver®. A Stop order is not a Limit order.

A Stop Order to sell is commonly used to minimise a loss or protect a gain on an existing holding. 

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