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It would execute at the gap right?
by sjg007 6y ago
It would execute at the gap right?
- svachalek 6y agoIt would go to the first buyer under the limit. So for example if you had a stop loss at $200 and the stock went from $201 to $2, it would sell for $2.
- deleted 6y ago[deleted]
- nrmitchi 6y agotldr; When your stop-loss is hit, it executes at the best price available at the time, which (as far as I know) has no guarantees. I think a good example of this is the Ethereum flash-crash on Coinbase in.... 2017? Something happened (IIRC someone submitted a very large market-sell, maybe by accident), but it completely wiped out half of the order book. This triggered all of the stop-losses that people had submitted. But... almost the entire order book was gone. So they sold very low. Which triggered more stop-losses. Which sold lower, and so on. In the end stop-losses ended up largely selling to one super-lucky-account-that-I'm-sure-set-this-up-as-a-joke-and-forgot-about-it who had a limit buy in for 10c/ETH. IIRC the price was ~350 when this started. When people were able to start buying again, the price jumped up again (obviously). But this lucky person was able to buy ~5k ETH at 10c, because all the stop-losses triggered. ¯\_(ツ)_/¯