What Is a "Limit Order" and How Can It Mitigate Slippage? ▴ Learn

What Is a “Limit Order” and How Can It Mitigate Slippage?

A limit order is an order to buy or sell an option at a specified price or better. It allows the trader to set a maximum price they are willing to pay or a minimum price they are willing to accept.

By using a limit order, a trader ensures they do not execute a trade at an unfavorable price, thereby completely mitigating slippage, although the order may not be filled immediately or at all.

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