NYSE join NASDAQ and decide to eliminate stop orders. This is ridiculous in my opinion! The New York Stock Exchange, in a statement, said it would no longer accept what are called stop orders. It is going to start from Feb. 26. Also good-till-canceled type of orders is going to be eliminated.
What stay behind this decision? Read more below.
NYSE and NASDAQ eliminate stop orders
NYSE state that:
A stop order could be triggered after a big downward move, but investors could be unhappy when the stock quickly recovers its value. Another risk is the stock falls much further than the level where the stop order was intended to be executed.
They also stated that Stop Orders were rarely used – only 0.2% of the time:
Sources: 1. https://twitter.com/nanexllc/status/666977076809961474/photo/1?ref_src=twsrc^tfw 2. http://www.marketwatch.com/story/nyse-joining-nasdaq-in-eliminating-stop-orders-2015-11-18
What is interesting the exchanges have or are about to eliminate such orders, but brokers will still be able to provide such order types.
What is your opinion on that? Do you use stop orders?
