An order to sell stock at the market price when the price of the stock falls to a specified level is called a:
A) limit order
B) market order
C) short sale
D) stop-loss order

Question

Quizplus · Accepted Answer

A stop-loss order is an order to sell stock at the market price when the price of the stock falls to a specified level. This is a risk management technique used by investors to limit potential losses if the stock price falls. A limit order is an order to buy or sell a stock at a specific price or better, while a market order is an order to buy or sell a stock at the best available price. A short sale is a transaction in which an investor sells borrowed shares in the hopes of buying them back at a lower price to make a profit.

An Order to Sell Stock at the Market Price When