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TLRam1

Stock Market Order Types

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This was going to be strictly about the topic heading but I think I have some answers to that so I changed it up a bit.

 

1   1. Do you go through a broker or self directed stock purchases?

2    2. What type of stock orders do you use, as in Stop Loss, Trailing Stop Loss, Limit Orders, etc.?

3    3. If you purchase stock in the morning how long before you can sell the stock? Hours later, same day?

 

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Like most things in life, there isn't any single answer that fits all of us. I stopped doing my own investing back when we retired and went on the road. What works best and gets best results depends on my things, like the amount of money you are investing, what your goals are, how much of your time are you willing to put into your investing and a host of other issues. These forums have a lot of self proclaimed experts and several here regularly claim to make vastly better results than any professional, yet I never seem to see any of them traveling in the style that would indicate wealth??  Your questions make me suspect that you plan to be a day trader, which is something that is far beyond what most people here get involved in. 

I can only tell you what we did and our experience, then you make your choices. We very carefully researched financial managers and placed our investments with him. While our first experience was not all good, since we settled with our current manager we have done very well. We are past the age requiring "required minimum distribution" and have been for 5 years now and yet our investments continue to grow at a rate that exceeds our withdrawals, so we are happy with the result. 

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6 hours ago, TLRam1 said:

This was going to be strictly about the topic heading but I think I have some answers to that so I changed it up a bit.

1   1. Do you go through a broker or self directed stock purchases?

I buy through Vanguard, easy transactions at little cost.

2    2. What type of stock orders do you use, as in Stop Loss, Trailing Stop Loss, Limit Orders, etc.?

I'm not too market savvy.  I usually buy a stock on a whim and keep it for years, so my purchases are just for a certain number of shares at market price.

3    3. If you purchase stock in the morning how long before you can sell the stock? Hours later, same day?

I don't know the answer to your question.  However, Vanguard is very easy to call and ask questions like this.  They are friendly and knowledgeable.

 

 

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Most of our market investments are in index funds, self directed.  Wherever the market goes we are along for the ride.  We own a few stocks but these are bought to hold long term chasing dividends.  

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I do my own trading, using both trailing stop losses and limit trades. I've done leveraged trades in the morning and traded them a few hours later. However, you can't use those proceeds for a new purchase until it's settled. Since I haven't done that in some years, my memory isn't the best, but I'm quite sure that one trade before settlement is the legal limit. At my brokerage, that's three days. Jay

https://www.ally.com/do-it-right/investing/what-are-unsettled-funds/

Edited by Jaydrvr

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21 hours ago, Kirk W said:

"These forums have a lot of self proclaimed experts and several here regularly claim to make vastly better results than any professional, yet I never seem to see any of them traveling in the style that would indicate wealth?? 

 

Kirk you do that name calling regularly here, calling others "self proclaimed experts" here and in the computer forums, both areas where you pay others and don't have the expertise yourself according to your own posts. I know you aren't talking about me because I've repeatedly said I was the least experienced investor here. I just understood the tech Musk was doing as early as 2003, and you remember my posts here about BEVs, Tesla, and Space X from 2003 on right?

Kirk, your demeaning others with pontificating and name calling only hurts your own credibility. It's not helping and kind for folks to come here and see a self professed leader here throwing rocks at people with innuendo. I'd suggest you confront these people in email or face to face and work out your differences. Despite knowing you aren't referring to me, as an example, how would you know I don't travel in whatever style you deem indicates wealth. You do know conspicuous consumption is out right? How many people in this finance forum have you met so when you start your demeaning innuendo, you have at least the credibility of having met them at all! You've never met me, nor have we been in the same place camping! LOL Let's let John Cleese inject some humor into what I'm saying with this John Cleese 60 second video he produced with the help of a clinical researcher in studies of intelligence.

 

Edited by RV_

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TL Ram,

Back to the topic,I am exactly like Chirakawa above and self direct. I would never day trade, it's potentially more costly than trying to make money gambling at casinos. As well I have cash reserves for the next recession where I will buy up some index funds for long term when they are at bargain basement prices like the last time 2007/8/9 when I did some bargain basement priced buying. one thing I've done since I bought my first car and motorcycle at 16 was to buy cash, never new, and avoid all the expense of full coverage insurance. My last three homes and our new place in Colorado were all paid for cash, as are my cars, and other commodity purchases. If one does real math the folks bragging that uncle Sam paid for this or that don't understand that unless you've real wealth in the millions and up to manage, all you save is whatever your tax rate. Simplistically put you pay twice the purchase price for your house on average with a 20-30 year mortgage. I worked hard and we flipped houses as well as renovating updating our house until we had the money for our next house from the last. So with 0 debt, no car notes, no house notes, our only monthly outflows are for utilities and fuel/food/clothing. Insurance is paid a year at a time. So we can keep our cash and investments except one IRA from Lynn's Civil service days. We increased those holdings quite a bit and will sell them and take the hit tax wise to use it all now for the next market correction. Cash isn't always the best position to be in either, especially with the volatility of a record breaking bull run. The drop is always preceded by a six month to year spectacular gains and I think we are at the beginning of that last big profit opportunity before the correction. If one is in Microsoft, Tesla, Apple, and a few other top stocks even if they drop they won't go out of business like the car makers not well ahead in their transition to BEVs will be if caught in a recession. Except this time let's not bail them out. And let's get people elected who will get rid of the bail in rules enacted in the last ten years so banks can't seize our deposits as their assets without so much as asking. Let's hold the bank officers accountable the next time. Not us the taxpayers.

Safe investing!

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Limit Order: if you buy with a limit price, you can price it lower than the current market price and "usually" get it for below market price - but not usually very much, if at all.

 

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Back to one of your questions.

When I first started investing in an individual stock rather than funds it was 2010 and Tesla when they finally IPO'd. I'd only been waiting for seven years since 2003 to invest in them and posted about them here. I held it until 2018, eight years. I have only invested in two more since and they are long term which for me is like buy and forget. If I sold them today I'd have a loss.

When Tesla had risen past $100 after I had bought for between $17 and $22.50, I sold enough to take back my money plus $5k Profit exactly. So from that moment on I was playing with house money. There is a very long thread here called Are you still in where I started to participate in 2011. That thread chronicles the attitudes and predictions of some here that panned out, others whose predictions did not.

But I remembered a 72 hour limit on selling then buying back but since it meant I'd have to have enough money to reinvest before I had access to the money from a sale because I'd have to wait three days.

Remember I'm the least experienced investor here who's had a big play and called it and every move by Tesla along the way.

Before you get confused here it is:

https://pocketsense.com/waiting-before-buying-back-stock-7891850.html

 

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I place limit orders. This way it will buy at the price that I want it to. Sure you can sell stocks that you just bought. You can even set up that order when you buy the stock. Heck you could only want to own that stock for minutes if you wanted. I trade myself online.

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On 2/21/2020 at 8:04 PM, RV_ said:

Ryno, read the link yet?

Not yet, my reply was based on your first post, which there is no link in it. But I plan on reading it.

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I had a guy who was handling my funds the last 1 ½ years, he a little more than doubled my money but does not want to handle trading of my account any longer, not a broker, just my CPA and a gentleman’s agreement.

I had a stock broker for many years, in the beginning it was good than downhill from there. Even in the good days and thereafter he would purchase a stock, for example, $20 dollars a share, it goes up to $25.00, drops back to $22. In my mind I question why did we not sell it around the $25 mark and repurchase at the $22 mark? I know the problem, no crystal ball, I understand. Any news and it starts tanking we need to get out, that is his job, right?

His target to sell is $28 so we hold until he is comfortable at selling close to the $28 mark. Brokers handle a lot of people accounts and probably easier for them to let it ride instead of putting in a Trailing Stop Loss order say at $1.00 below.

Since my guy stopped handling my account I have been on a crash course to figure this out without tying myself to the computer.  

  In the example above, a (TSLO) Trailing Stop Loss sell order would follow the stock price up, initially when purchased at $20 the order to sell would be at $19, as the price of the stock moves up say to $25 the TSLO would move up also to $24.

This is an automatic sell if the price drops to $24, it saves your profit, I did not know this existed. On the flip side when my broker would buy something it might drop 10% and stay there a while, if I had this in place we could have cut my losses and repurchase at a later time.

Of course if a broker does this on all stocks that this would apply, it would be a lot of work for him but best for his clients, they take the easier way out. 

Not exactly Day Trading Kirk but could be as in the case of Tesla who we all know about. Along with Virgin Galactic Holdings, Inc. Space (SPCE), it went up 24% in a day, I watched it do this. Another day it did the same, went up than back down, in this case it would be a day trade, though not intended when you bought the stock but to protect your margins.

AMD Advanced Micro Devices, the chip processor, is another one and the stock my CPA more than doubled my money on. In the last few months it went from $28 to $55 now.  

 

Edited by TLRam1

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I did read the article, I don't think what I or we would be doing would be alarming to the IRS, never know so that is good to know.

There is something to the settlement date that I talked over with my brokers rep., you can buy without/before funds being settled but if you sell again before the first sell is settled you will be restricted for ninety days  to only buy with settled funds.

So you can Buy - Sell - Buy (on unsettled funds) but you can't Sell again until the first sell has been settled. If you do you are restricted as noted above, not a big deal and if you need to get out of something you Sell. This could happen on a volatile stock like Tesla but otherwise you would be fine as settlements take about 2-3 days.   

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I sold everything I was up on on the second down day and let things that I was down ride. So now I have a good amount of cash sitting on the sidelines waiting to get back in. Plus I took a chunk into a 1 year CD at 2.2%. I still think that we have a bit more pain to get through. And if we start seeing a lot of cases in the US it will get way worse in my opinion. 

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On 2/25/2020 at 2:50 PM, TLRam1 said:

I had a guy who was handling my funds the last 1 ½ years, he a little more than doubled my money but does not want to handle trading of my account any longer, not a broker, just my CPA and a gentleman’s agreement.

I had a stock broker for many years, in the beginning it was good than downhill from there. Even in the good days and thereafter he would purchase a stock, for example, $20 dollars a share, it goes up to $25.00, drops back to $22. In my mind I question why did we not sell it around the $25 mark and repurchase at the $22 mark? I know the problem, no crystal ball, I understand. Any news and it starts tanking we need to get out, that is his job, right?

His target to sell is $28 so we hold until he is comfortable at selling close to the $28 mark. Brokers handle a lot of people accounts and probably easier for them to let it ride instead of putting in a Trailing Stop Loss order say at $1.00 below.

Since my guy stopped handling my account I have been on a crash course to figure this out without tying myself to the computer.  

  In the example above, a (TSLO) Trailing Stop Loss sell order would follow the stock price up, initially when purchased at $20 the order to sell would be at $19, as the price of the stock moves up say to $25 the TSLO would move up also to $24.

This is an automatic sell if the price drops to $24, it saves your profit, I did not know this existed. On the flip side when my broker would buy something it might drop 10% and stay there a while, if I had this in place we could have cut my losses and repurchase at a later time.

Of course if a broker does this on all stocks that this would apply, it would be a lot of work for him but best for his clients, they take the easier way out. 

Not exactly Day Trading Kirk but could be as in the case of Tesla who we all know about. Along with Virgin Galactic Holdings, Inc. Space (SPCE), it went up 24% in a day, I watched it do this. Another day it did the same, went up than back down, in this case it would be a day trade, though not intended when you bought the stock but to protect your margins.

AMD Advanced Micro Devices, the chip processor, is another one and the stock my CPA more than doubled my money on. In the last few months it went from $28 to $55 now.  

 

Well hind site is 20/20. You will never get the big moves unless you were in the stock. If someone knew how to time the market, they would be the richest person in the world. 

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1 hour ago, rynosback said:

Well hind site is 20/20. You will never get the big moves unless you were in the stock. If someone knew how to time the market, they would be the richest person in the world. 

That might be true , if , that person was smart enough to keep his/her mouth shut and applied a very diverse accounting system . 

If ever found out , there would be a rather sudden stop involved . Most likely one that 'seemed' accidental . 

Edited by Pat & Pete

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4 hours ago, Pat & Pete said:

That might be true , if , that person was smart enough to keep his/her mouth shut and applied a very diverse accounting system . 

If ever found out , there would be a rather sudden stop involved . Most likely one that 'seemed' accidental . 

Not really sure what you are saying? Keep there mouth shut? How is timing the market a diverse accounting system? Why a sudden stop? I never said anything like inside trading that was illegal that would make it come to a stop on purpose or accidental. Just trying to understand your reply from your post that you quoted me on.

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7 hours ago, rynosback said:

Not really sure what you are saying? Keep there mouth shut? How is timing the market a diverse accounting system? Why a sudden stop? I never said anything like inside trading that was illegal that would make it come to a stop on purpose or accidental. Just trying to understand your reply from your post that you quoted me on.

I referred to nothing illegal . 

When someone 'finds' a way to beat the odds , legal or otherwise , that path will be shut down in one way or another . Usually as quickly as possible . 

The powers that be will not allow it , for whatever reason(s) . 

Here's one example

https://www.cbsnews.com/news/jerry-and-marge-selbee-how-a-retired-couple-won-millions-using-a-lottery-loophole-60-minutes-2019-06-09/

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That is a great story about the Sebee's lottery. It reminds me of one in Atlantic City casino. A patron figured out the sequence of the number generator in a "random number" game.

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12 hours ago, Pat & Pete said:

I referred to nothing illegal . 

When someone 'finds' a way to beat the odds , legal or otherwise , that path will be shut down in one way or another . Usually as quickly as possible . 

The powers that be will not allow it , for whatever reason(s) . 

Here's one example

https://www.cbsnews.com/news/jerry-and-marge-selbee-how-a-retired-couple-won-millions-using-a-lottery-loophole-60-minutes-2019-06-09/

Good for them. It read that the invested over $500k to get $8??k in returns. And then many more still not sure how that explains your first reply that I questioned? The stock market is not a lottery. Everyone can access public information and make a decision to invest. 

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On 2/28/2020 at 9:51 PM, rynosback said:

Good for them. It read that the invested over $500k to get $8??k in returns. And then many more still not sure how that explains your first reply that I questioned? The stock market is not a lottery. Everyone can access public information and make a decision to invest. 

The Selbees are simply an example of the powers that be shutting down an easy money 'loop hole' .

Matters not what the vehicle is , lotto or market or robbing a bank .

And , the market is just about as chancy as the lottery . You or I have absolutely no control as to which way and/or why a stock or commodity will go . Sure I can predict with a fair amount of accuracy what will happen in the near future , given a decent chart , but , that's about the extent of any 'control' . 

 

Edited by Pat & Pete

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What I am finding out by this research of and on the job learning, if you put Trailing Stop Orders on your purchases it will save your margins especially important in a huge downturn we are seeing.

If I had known about this on the pot stocks I would not have lost 20% before getting out. Those of you who held your pot stocks this would have saved your bacon also.

If you use the Trailing Stop Orders feature yourself or through a broker, with Fidelity you choose Good Till Canceled and it last for 6 months but will also send you a notification before it is about to cancel so you can re-up it again. With Merrill Edge I am not sure how long it last or if they have a notification feature. These are the two I have money with, by the way, no reason to use these, it is just what I have.  

I am not telling you to use this but it is an option and I don't see a big downside why we as investors do not utilize it more, we need every edge we can get.

 

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