Question

You purchased XYZ stock today for $40 and feel it will go up over time. You...

You purchased XYZ stock today for $40 and feel it will go up over time. You expect to hold on to the stock for over one year. If there is an unexpected market crash, however, you feel it could drop up to 75% and would want to sell automatically. Thus on the same day, you place a ____ at $30

limit-buy order

limit-sell order

market order

stop-loss order

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Answer #1

Answer:

  • option 4 : Stop-loss order

Explanation:

  • Stop-loss order is basically an option that you can use to determine that: if the prices drops below your expectations, at what value you would like to automatically sell the stock.
  • Hence answer is Stop-loss
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