A Stop-Loss Order (Or a Sell Stop Order)

question 3

Multiple Choice

A stop-loss order (or a sell stop order) :

• A) becomes a market order as soon as a trade takes place at this price,which is higher than the current market price
• B) is a limit sell order above the current market price
• C) is a sell order placed at the ongoing current ask price
• D) is a sell order placed at a price lower than the current bid price
• E) None of these answers are correct.

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Definitions:

Conversion Premium

The extra amount an investor pays above the convertible security's underlying asset value, reflecting the cost to convert into equity at a later date.

Conversion Value

The financial value of converting an investment from one form to another, often used in the context of convertible securities.

Straight Bond Value

The present value of a bond's future interest payments and its principal amount at maturity, assuming it does not have any embedded options.

Intrinsic Value

The actual, inherent value of a financial asset, determined through fundamental analysis without reference to its market value.