• Order to buy – stocks will be bought at the lowest available price on the market
• Order to sell – stocks will be sold at the highest available price on the market

This instruction can also be described as a market instruction with an activation condition. It is used especially for a timely reaction to a rapid market change.

• Use: 

The client instructs the purchase of a security provided that the price crosses the set barrier. (For example, the announcement is expected of a company’s important results. In the event of extraordinarily good results, the price of shares may cross a signicant barrier and rise sharply. In such a case, the client already wants to make a prot from this rise.)

• Instruction parameters:

Activation price: the price that activates the buying instruction. So that the buying instruction can be activated, securities must be traded once for this or a higher price.

The condition for setting the activation price: the activation price must be > the current price (price of the last closed transaction).

• Example: The stop market for buying:
  • current price: CZK 480
  • the client instructs the purchase of a security provided that the price crosses the barrier of CZK 500
  • the client instructs: STOP MARKET 
  • activation price: CZK 500

If trading takes place on the market for a price higher or equal to CZK 500, then an instruction to buy is sent out to the market. The type of instruction is the market instruction. Securities are bought for the lowest available price on the market.

• Use:

The client owns securities and wants to be insured against loss from a possible sharp price fall. (For example, the announcement is expected of a company’s important results. In the event of the surprisingly negative results the price of shares may fall sharply. The client wants to be insured against a big loss and therefore instructs a stop limit for selling.)

• Instruction parameters:

Activation price: the price that activates the selling instruction. So that the selling instruction can be activated, securities must be traded once for this or a lower price.

The condition for setting the activation price: the activation price must be < the current price (price of the last closed transaction).

• Example: Stop market for selling
  • current price: CZK 520
  • the client wants to be insured against a sharp price fall, instructs the sale of securities provided that the price crosses the barrier of CZK 490
  • the client instructs to sell: STOP MARKET activation price: CZK 490

If trading takes place on the market for a price lower or equal to CZK 490, then an instruction to sell is sent out to the market. The type of instruction is the market instruction. Securities are sold for the highest available price on the market.

Order parameters: Limit price (price condition)

• Order to buy – stocks will be bought at the lowest available price on the market, at the set limit price at the most.
• Order to sell – stocks will be sold at the highest available price on the market, at the set limit price at least.