In this article:
Overview
Stop-limit orders allow you to set a stop price and a limit price for a given security. Once a security reaches your stop price, the order is automatically converted into a limit order (either a buy or sell).
What to expect
- Stop-limit orders won't execute unless markets are open.
- To place a stop-limit order when buying a security, you'll need to change your order type to a stop-limit order.
- There are certain restrictions on placing stop-limit buys with Wealthsimple.
- By default, stop-limit orders expire at market close if they can't fill within the day. See below on how to extend this expiry (except for partial fills).
- Stop-limit orders are any-part orders once triggered. If we can only fill part of your order, we'll try to do it.
- This article covers stop-limit orders for stocks, ETFs, and options. Crypto stop-limit orders work a bit differently. See Choose a crypto order type to learn more.
Understanding stop-limit buys
A stop-limit buy allows you to choose a stop price and a limit price. With a stop-limit buy, your order must hit the stop price you set to turn into a limit buy order. Stop-limit buys are often used when there is a price you would pay for a stock that is greater than what it's currently trading at.
Example
Company XYZ (trading as XYZ) is about to release its quarterly earnings report, and Morgan believes that the stock is going to go up. She would like to buy some stock when it starts showing some upwards momentum.
- Specifically, Morgan wants to buy stock XYZ if it hits $100, as she believes this will be the start of its upwards momentum. At 10:00 am, XYZ is trading at $95.
- Morgan sets up a stop-limit buy order on stock XYZ with a stop price of $100 and a limit price of $100.
- This means that if the price of stock XYZ rises above or reaches the $100 stop price, her order will automatically convert into a limit order with a $100 limit price.
- At 3:00 pm, the price of stock XYZ rises to $100. This means that at 3:00 pm, Morgan's order has hit the stop price and turns into a limit order.
- As her limit price is $100, her buy order will fill as soon as possible, as long as the price of stock XYZ does not rise above $100 before the order is able to fill.
Understanding stop-limit sells
A stop-limit sell allows you to choose a stop price and a limit price. With a stop-limit sell, your order must hit the stop price you set to turn into a limit sell order. Stop-limit sells are often used to limit losses.
Example
Stock XYZ is trading at $100. After doing some research, Morgan discovers that experts believe that the price of XYZ will start to decline in the next few hours. She wants to make sure that if this happens, she sells her shares of XYZ before the price goes too low.
- Specifically, Morgan wants to sell stock XYZ if it drops to $95.
- Morgan sets up a stop-limit sell order on stock XYZ with a stop price of $95 and a limit price of $95.
- This means that if stock XYZ drops to or below the $95 stop price, her order will automatically convert into a limit order with a $95 limit price.
- At 3:00 pm, the price of stock XYZ drops to $95. This means that at 3:00 pm, Morgan's order has hit the stop price and turns into a limit order.
- As her limit price is $95, her sell order will fill as soon as possible, as long as the price of stock XYZ does not drop below $95 before the order is able to fill.
How this compares to a limit order or a stop-market order
A limit order is active as soon as you place it; there's no trigger involved. A stop-limit order and a stop-market order both wait until the market reaches a stop price you set, and differ in what happens once that stop price is hit. See Understanding limit orders and Understanding stop-market orders for stocks, ETFs, and options, or Choose a crypto order type for the crypto version.
| Order type | Waits for a stop price? | Prices you set | What happens once it starts | What you're trading off |
|---|---|---|---|---|
| Limit | No | Limit price only | Nothing to trigger, so it's live immediately | Price certainty over fill certainty |
| Stop-limit | Yes | Stop price and limit price | Becomes a limit order at your limit price | Price certainty over fill certainty |
| Stop-market | Yes | Stop price only | Becomes a market order | Fill speed over price certainty |
Supported stop-limit orders through Wealthsimple
Review what types of stop-limit orders Wealthsimple supports below. Please note that we'll automatically reject any unsupported stop-limit orders.
| When the stop price is higher than the current quote | When the stop price is lower than the current quote | |
|---|---|---|
| CAD buy | Supported | Supported* |
| CAD sell | Supported** | Supported |
| USD buy | Supported | Unsupported |
| USD sell | Unsupported | Supported |
You can only set a different stop price and limit price on US stop-limit orders. On Canadian stop-limit orders, your stop price and limit price need to be the same.
*CAD stop-limit buys
Please ensure that the stop price is greater than the current ask. While orders with stop prices lower than the current market are accepted, their behaviour may differ from what is expected.
**CAD stop-limit sells
Please ensure that the stop price is lower than the current bid. While orders with stop prices greater than the current market are accepted, their behaviour may differ from what is expected.
Frequently asked questions
How do I extend the expiry of my stop-limit order to 90 days?
To extend your stop-limit order expiry to only expire after 90 days and not at the end of the trading day (except for partial fills), follow the steps below when placing your order:
- Log in to the Wealthsimple app
- Select the security you wish to buy or sell, and begin placing your order
- After entering your stop price, limit price, and the number of shares you wish to buy or sell, select Next
- Change the Trading session to Market hours
- Change the Expires section to Good until cancelled (up to 90 days)
- Tap Review
- Review your order details and tap Submit order
- Your order will now be open for a maximum of 90 days before expiring
- Log in to your Wealthsimple profile
- In the Search name or symbol field, search and select the security you wish to buy
- On the right side, select Stop limit buy from the Order Type menu
- Select Place a stop limit order
- On the new page, check that Stop limit buy is still selected as the Order Type
- After entering your stop price, limit price, and the number of shares you wish to buy, select Buy and then Continue
- At the bottom of your order summary page, check the box that says Keep my order open until filled or I cancel it
- Your order will now be open for a maximum of 90 days before expiring
What does it mean to partially fill an order?
Once triggered, if a part of your order can be filled (if you're trying to buy three shares, but there are only two available at your limit price or better), this part will still go through.
If your order partially fills, the remaining part of your order will expire at the end of the trading period, regardless of the expiry date set. You'll need to place a new order for the remaining shares.
How do I modify or cancel a pending stop-limit order?
You can follow these steps to modify or cancel a pending order for stocks, options, and crypto.
Can I place a stop-limit order on crypto?
Yes. Crypto stop-limit orders are available for custodial crypto trading, and they work a bit differently from the stocks, ETFs, and options version described in this article. See Choose a crypto order type for the details.
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