V. 19:2 (24, 64): Q&A by Don Bright
Product Description
NASDAQ STOPS
Are Nasdaq stops possible?My broker
tells me that you can’t protect yourself
on the downside by putting in a stoploss
sell order if your stock is listed on
the Nasdaq. Is that true? — Lana
Huddleston
Good question. Since there is no actual marketplace with a single entity in control of the pricing of the stock, as there is on the New York Stock Exchange (NYSE) and the American Stock Exchange (AMEX) (specialist system), then who would be holding your stop order? Since the Nasdaq is a fragmented market (using many market makers instead of a single specialist), there is no practical way to execute stop orders. (cont.)
Good question. Since there is no actual marketplace with a single entity in control of the pricing of the stock, as there is on the New York Stock Exchange (NYSE) and the American Stock Exchange (AMEX) (specialist system), then who would be holding your stop order? Since the Nasdaq is a fragmented market (using many market makers instead of a single specialist), there is no practical way to execute stop orders. (cont.)
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