Fay placed an order to sell 500 shares of stock she currently owned. As soon as the order reached the trading floor, the shares were immediately sold. Which type of order did Faith place?

Question

Quizplus · Accepted Answer

Fay placed a market order, which involves selling the shares at the current market price as soon as the order reaches the trading floor. This is different from a limit order, where the seller sets a specific price at which they are willing to sell the shares, or a stop order, which is triggered when the stock hits a certain price point. A day order simply means that the order is only valid for the current trading day, while a short order involves selling shares the seller does not yet own, in the hopes of buying them back later at a lower price to make a profit.

Fay Placed an Order to Sell 500 Shares of Stock