Stopped Order

AAA

DEFINITION of 'Stopped Order'

A market order on the NYSE that is stopped from being executed by the specialist because of a request from a member firm to obtain a better price than that available. According to NYSE rules, once the order is stopped, it must be identified and the specialist must guarantee the market price at the time of the stop should they be unsuccessful in obtaining a better price.

INVESTOPEDIA EXPLAINS 'Stopped Order'

This is a procedure on the NYSE in which the specialist is actively involved in the market as an agent representing a member firm.

An example would be when a member firm is trying to buy company ABC at $10. If the current asking price is $10.25 and the specialist has agreed to stop the market order for the member firm, the order will be stopped and the specialist will post a bid for $10.00. Should the order not be filled for the member firm at the $10, and the market continues to advance, the specialist will be obliged to fill the order at the $10.25.

There are many different ways an order can be stopped under the guidelines of the NYSE. These orders should not be mistaken with limit orders or stop orders placed by investors.

RELATED TERMS
  1. Agent

    1. An individual or firm that places securities transactions ...
  2. Ask

    The price a seller is willing to accept for a security, also ...
  3. Bid

    1. An offer made by an investor, a trader or a dealer to buy ...
  4. Market Order

    An order that an investor makes through a broker or brokerage ...
  5. Member Firm

    A broker-dealer in which at least one of the principal officers ...
  6. New York Stock Exchange - NYSE

    A stock exchange based in New York City, which is considered ...
Related Articles
  1. Active Trading Fundamentals

    The Basics Of Trading A Stock

    Taking control of your portfolio means knowing what orders to use when buying or selling stocks.
  2. Active Trading Fundamentals

    The Stop-Loss Order - Make Sure You Use It

    It's a simple but powerful tool to help you implement your stock-investment strategy. Find out how.
  3. Active Trading Fundamentals

    Stimulate Your Skills With Simulated Trading

    Think you can beat the Street? We'll show you how to test your abilities without losing your shirt.
  4. Brokers

    How long does it take a broker to confirm a trade after it is placed?

    Learn about placing trades with a broker and the amount of time required to received confirmation of different types of orders, such as limit and stop-loss.
  5. Trading Systems & Software

    How do you know if a trade placed to a broker is confirmed?

    Learn how to check if trades placed with brokers online or over the telephone have been filled and confirmed. Explore different types of orders.
  6. Active Trading Fundamentals

    What's the difference between a market order and a limit order?

    Buy and sell trades with market orders at the present stock price and execute limit orders if the stock price falls within certain present limits.
  7. Trading Strategies

    Patience Is A Trader's Virtue

    Waiting may be the biggest key to reeling in that trophy investment.
  8. Investing Basics

    Narrow Your Range With Stop-Limit Orders

    With stop-limit orders, buyers protect themselves from prices too high for their tastes.
  9. A trailing stop is an order to buy or sell a security if it moves in an unfavorable direction.
    Trading Strategies

    How to Use Trailing Stops

    A trailing stop is an order to buy or sell a security if it moves in an unfavorable direction.
  10. Active Trading

    Pinpoint Winning Trade Entries With Filters And Triggers

    These tools will help you enter at high-probability points and ensure you trade within your set strategy.

You May Also Like

Hot Definitions
  1. SWOT Analysis

    A tool that identifies the strengths, weaknesses, opportunities and threats of an organization. Specifically, SWOT is a basic, ...
  2. Simple Interest

    A quick method of calculating the interest charge on a loan. Simple interest is determined by multiplying the interest rate ...
  3. Special Administrative Region - SAR

    Unique geographical areas with a high degree of autonomy set up by the People's Republic of China. The Special Administrative ...
  4. Annual Percentage Rate - APR

    The annual rate that is charged for borrowing (or made by investing), expressed as a single percentage number that represents ...
  5. Free Carrier - FCA

    A trade term requiring the seller to deliver goods to a named airport, terminal, or other place where the carrier operates. ...
  6. Law Of Supply And Demand

    A theory explaining the interaction between the supply of a resource and the demand for that resource. The law of supply ...
Trading Center