Contingency Order

外汇网2021-06-19 14:36:12 69

An order that is executed only when certain conditions of the security being traded, or another security, have been fulfilled. Such prequisite conditions range in scope and depth. In a simple case, a contingency order may depend on the potential purchaser's ability to sell a different security in his or her portfolio to free the funds to make the purchase. In a more complicated situation, an options contingency order's execution may depend on the share price of the options' underlying stock

A stop-loss order can be viewed as a contingency order because it does not become a market order until the price of the stock being sold reaches a pdetermined price. This type of order is very useful when applied to the sale or purchase of options.

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