Market order or limit order

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Question

Identify in each case below whether the trader is more likely to use a market order or a limit order. Explain.

1. A trader is following one of the largest industrial stocks in the SP 500. The stock just announces that its last quarter earnings are better than market expectation.

2. A trader is instructed by his client to sell 100,000 shares of a stock (to liquidate and get cash) by the end of the trade day. The average daily turnover over the past 10 days of this stock is about 500,000 shares.

Reference no: EM133272657

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