Sent: Friday, September 06, 2002 7:25 PM

To: canslim@lists.xmission.co= m

Subject: Re: [CANSLIM] Buy= Stop Limit orders?

Nancy, a stop order converts to a market order (wherever the market= is then). A stop LIMIT order converts to a LIMIT order (again, wherever = the market is). So if the stop price is hit by a big gap, then the stop o= rder becomes a market, and naturally executes, altho at a price that may = be a real surprise. A stop LIMIT order, because it now is a LIMIT order, = may not execute if the market moved outside of the LIMIT range.

Example: you find an absolutely perfect, classic, textbook= cup and handle. Can't find a single thing wrong with either the chart or= its fundamentals, even after exhaustive hours of due diligence (ok, I ad= mit it, I like to fantasize).

You determine that= the perfect pivot point is exactly $25.20, so you enter a Buy Stop order= at $25.30. Your friend, however, enters a Buy Stop LIMIT order at Buy St= op $25.30, LIMIT $26.46 (5% over the pivot). Shortly before the open, the= company announces that it has accepted a cash buyout at $29, and the sto= ck gaps to that price (or higher, or just under) as the shorts immediatel= y cover. Your buy is executed at around $29, and the best you can hope fo= r is to sell at a breakeven, if you are lucky cover transaction costs. Yo= ur friend's order never executes because of the LIMIT and is able to simp= ly cancel the order when the news is discovered.

Exactly the same thing can happen on a Sell Stop / Sell Stop LIMIT orde= r. A stop order means you take what the market gives you, and can be trig= gered when the volume might have kept you out of the trade entirely. A st= op LIMIT order means you may never get an execution, but may have a secon= d chance to evaluate the situation, and change the order, or cancel it en= tirely.

As one further comment, many firms stil= l will not accept Stop LIMIT orders on NASDAQ stocks, especially if they = are not very liquid.

----- Original Message ----= - -

From: NANCY POLCARO=

To: canslim

Sent: = Friday, September 06, 2002 4:10 PM

Subject: Re: [CANSLI= M] Buy Stop Limit orders?

which is right= ? One says a stop order will always execute somewhere even if = it is not at the stop price( this is what I thought) and one says th= e market can pass through the stop and it will never be executed. T= hey both can not be correct. Advice from the more experienced then = I please. Thanks again for the help nancy

<= BLOCKQUOTE style=3D"PADDING-RIGHT: 0px; PADDING-LEFT: 5px; MARGIN-LEFT: 5= px; BORDER-LEFT: #000000 2px solid; MARGIN-RIGHT: 0px">

----- Original Message -----

From: Dan Forant

Sent: Friday, September 06, 2002 = 10:57 AM

To: canslim@lists.x= mission.com

Subject: Re: [CA= NSLIM] Buy Stop Limit orders?

A stop order, buy or= sell will always execute (somewhere). A Stop Limit
order may not if t= he market blows up through the stop *limit*.

DanF
----- Origina= l Message -----
From: "david frank" <camelot.homes@charter.net><= BR>To: <canslim@lists.xmission.com>
Sent: Friday, September 06, = 2002 12:53 PM
Subject: Re: [CANSLIM] Buy Stop Limit orders?

> Warren, the bad thing about a stop order is that it is a secondary = order.
A
> broker doesn't have to execute it, thereby, you don't= really have any
> recourse, if it is not executed, although the pr= ice of the stock was
within
> your price parameters. If the pric= e of the stock is outside of your stop,
it
> will not execute. d= ave
> ----- Original Message -----
> From: "Warren Keuffel" &= lt;wkeuffel@xmission.com>
> To: "CANSLIM list" <canslim@lists= .xmission.com>
> Sent: Friday, September 06, 2002 10:55 AM
&g= t; Subject: [CANSLIM] Buy Stop Limit orders?
>
>
> >= I am curious (yellow) -- sorry, bad joke that will be undersood only by<= BR>> > those of a certain age, if no one "gets" it I will explain, = if asked --
> >
> > anyway, back to the subject -- whet= her people here have used buy stop
> > limit orders to trigger a= purchase if the price of a stock rises above
> > the limit pric= e. You would need to use this with some sort of manual or
> > au= tomatic scan for increased volume to make a good buy on a breakout,
&g= t; > but given the volume, seems like a buy stop limit order would hel= p one
> > buy at the pivot point. Or not?
> >
> &= gt; Thanks,
> > Warren
> >
> >
> > -<= BR>> > -To subscribe/unsubscribe, email "majordomo@xmission.com"> > -In the email body, write "subscribe canslim" or
> > = - -"unsubscribe canslim". Do not use quotes in your email.
>>
> -
> -To subscribe/unsubscribe, email "majordomo@xmiss= ion.com"
> -In the email body, write "subscribe canslim" or
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>

-
-To subscribe/unsubscribe, email "majordomo@xmission.com"<= BR>-In the email body, write "subscribe canslim" or
-"unsubscribe cans= lim". Do not use quotes in your email.
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