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Answer:
Dear
Sam,
You
are probably referring to an order known as a GTC
or good 'til cancelled order. It's also known
on Wall Street as an open order.
This
is an order placed by an investor instructing the
broker that the order shall remain in effect until
filled or cancelled by the investor. However, it is
not entirely without limitations. Most brokerage firms
set a limit of 30 to 60 days. At that point, the broker
will automatically cancel the order or will ask the
customer if he/she wants to keep it active.
Here
at BUYandHOLD, there are two types of trades: Window
and Real-time, neither of which allow for a GTC order.
For
a Window Trade at BUYandHOLD, you choose the dollar
amount you wish to invest for a security, and you
choose the trading window for that order (10:00 AM
EST, 12:30 PM EST, or 3:00 PM EST). You do not have
a GTC opportunity for this type of trade at BUYandHOLD.
Any order that is not processed in a chosen window
will be processed at the next available trading window.
For
a Real-time Trade, you choose the dollar amount of
stocks that you wish to purchase. Each order is a
market order. If any order cannot be executed immediately
due to certain market conditions (such as trading
halts), your order will remain open until the end
of the day. If your order has not been processed by
the time the market closes, the order will be canceled.
If
you are interested, you can consider the E-ZVest service
at BUYandHOLD, which will allow you to purchase stocks
on a weekly, monthly, or quarterly basis. These are
not GTC orders per se, but BUYandHOLD will make purchases
based on the E-ZVest schedule you set up. Click
here to learn more about E-ZVest.
Good
'til cancelled orders are very handy for investors
who want to buy or sell a stock at a particular price
and don't mind waiting for the stock to reach that
price.
A
good 'til cancelled order actually helps insure the
investor that the trade will be executed at the specified
price -- even though he cannot actively follow the
stock's price all the time. In that respect, a GTC
could be very helpful while you're on vacation. They
are also welcomed by people who are extremely busy.
A
variation on the theme is the day order. In
this case, the investor's order to buy or sell a security
will expire automatically at the end of the trading
day on which it was entered. A day order is generally
used when an investor is uncertain and/or wishes more
time to consider a stock.
A
day order won't work for you unless you're going on
a one-day vacation getaway, but I thought you should
know about it.
Good
luck and happy vacation!
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