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Finance Glossary

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Price Limit Orders

Definition:

This is an order to your broker to buy or sell—but only within specific price range. For example, you might order your broker to sell for at least a certain amount (and no lower) or buy for no more than a specific price. This gives you some control over how much you pay for your investments. Most brokers charge more for limit orders, so be sure to check the fine print.

Example

From your Greek villa, you call your broker and say "I'll buy 1,000 shares of KO at $85 and not a penny more." That's a limit order.