# What Is a Closing Order in the Stock Market

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```					  Stock Market Game 2

I’m ready to pull the trigger, now what?
   Sell Order
   Short Sell Order
   Short cover
Order types
 Market Order - You pay the price at the
close of day.
 Limit Order - You set the price for what
you’re willing to pay or take (if you’re
selling)
 If the price reaches this point the trade will
 The cost of a share of stock is set by the market,
 End of Day Game transactions are priced at
market daily closing prices.
 SMG does not permit buying stocks or mutual
funds that trade below \$5 per share
 In the SMG, 2% is charged to all trades as a
brokerage commission.
 100 shares at \$10.00 per share = \$1000 + 2%
 (100x10)1.02 = \$1020
 The value of your stock is equal to your
purchase price, less the fees (in the previous
case; \$1000 - 2% = \$980
 All buy orders must be a minimum of 100 shares.
Selling

 Sell orders for less than 100 shares will
be permitted.
 A 2% broker's fee is charged for all
transactions. For example, if you buy 100
shares of a stock at \$10 per share, you
must pay the 2% of \$1000 or \$20.
Short Sell Orders
   Selling short is a trading strategy that’s designed to take advantage of an
anticipated drop in a stock’s market price.

   To sell short, you borrow shares through your broker, sell them, and use the
money you receive from the sale as collateral on the loan until the stock price
drops.

   If it does, you then buy back the shares at a lower price using the collateral, and
return the borrowed shares to your broker plus interest and commission. If you
realize a profit, it’s yours to keep.

   Suppose, for example, you sell short 100 shares of stock priced at \$10 a share.
When the price drops to \$7.50, you buy 100 shares, return them to your broker,
and keep the \$2.50-per-share profit minus commission. The risk is that if the
share price rises instead of falls, you may have to buy back the shares at a
higher price and suffer the loss.

   During the period of the short sale, the lender of the stock is no longer the
registered owner because the stock was sold. If any dividends are paid during
that period, or any other corporate actions occur, the short seller must make
the lender whole by paying the amount that’s due. However, that income is
taxed at the lender’s regular rate, not the lower rate that applies to qualifying
dividend income.All short sell orders must be for a minimum of 100 shares.
Short Cover

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Description: What Is a Closing Order in the Stock Market document sample