buy stops, by definition, are "above market" price
I disagree that this is true "by definition." There are times you may want to set a buy stop (instead of a limit order) below mkt price, especially if what you're basing the trigger on the stock's movement, and not so much on the actual price you get.
Say that for whatever reason (perhaps TA), you think one should buy a stock when it's 10 points down from the previous day's close, but you know that it might trade there only for an instant. If you set a buy limit there, you might not get filled, and sit on your buy order all day long. If you set it as a buy stop market order, you'll get filled even if it was just one transaction going thru at that price.
As for me, I use market orders most of the time, with the exception of bigger trades in slow markets, when I try to use limit orders inside the sperad. |
