Limit Price & Trigger Price in stock Trading

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Limit price in stock trading is the actual price that you demand during the execution of the order.

For a Stock Buy order, the limit price of stock must be greater than or equal to the trigger price. 

For a Stock Sell order, the limit price of stock must be less than or equal to the trigger price.

Trigger price of a stock is the price, which if touched, activates an order.

Scrip code : DLF

NSE	232.70	Prev. Close	Open	High	Low
06/05/2013 15:59:53	1.20  (0.52%)	231.50	230.70	233.90	229.10

LTQ 2 TBQ 2583 TSQ 0 Wt. Avg 231.75 TTQ 5925778 TTV (Lacs) 13732.99

Buy Market Depth Order Qty Price 16 2583 232.70 0 0 0.00 0 0 0.00 0 0 0.00 0 0 0.00

Sell Market Depth Order Qty Price 0 0 0.00 0 0 0.00 0 0 0.00 0 0 0.00 0 0 0.00

BSE	232.8	Prev. Close	Open	High	Low
06/05/2013 15:55:04	1.30  (0.56%)	231.5	232	234	229.7

Suppose you brought a DLF stock at 232.8.

You don't want a loss of more than Rs. 1.

So you put a stock stop loss sell order of Rs 231.8 with a stock trigger price of Rs 231.9.

What the system (exchange) does is - it checks if the LTP (Last Traded Price) is less than or equal to Rs 231.8.

As soon as the condition is met, the exchange will put your Rs 231.8 sell order in the normal order book.

Unless the LTP goes below or is equal to the trigger price, a stock stop loss trigger sell order is not activated.

Similarly Unless the LTP goes above or is equal to the trigger price, a stop loss trigger buy order is not activated.

Thus a trigger order has two components - trigger price and the price at which the order is placed.

A trigger order may also be a market order. This means if triggered, the trade will take place at market price.

Once your order is triggered, it is cancelled only at the end of the trading session.