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Finance: What Does "Buy Minus" Mean? 3 Views

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Description:

What does “Buy Minus” mean? Buy minus orders are used when investors think a stock will drop in price for a short period of time and plan to profit from that drop. The buy minus order tells the broker to purchase stock at a price that’s lower than the current trading price in order to benefit from what they think will be a brief decrease in price.

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Transcript

00:00
Finance a la shmoop what does buy minus mean? buy minus is a trading limit or rather a
00:10
trading rule given by a client wanting to acquire stock when it goes on flash
00:15
sale think Macy's white-flower day sale meets a bolt of lightning you know so [Sale banner outside Macy's and lightning flashes]
00:20
how's that work well Bobby bargain hunter sees the
00:23
highly volatile whatever dot-com trading at 8250 a share but notes that in the

00:28
last week it has been as high as 88 and as low as 75 Bobby wants to be long the
00:35
stock ie own it but doesn't want to pay retail price for it ie a "market
00:40
order" would just buy that stock at whatever price its trading at this [Market price appears]
00:45
moment so he puts in a buy minus order with a limit of 72
00:51
if the stock suddenly gaps down to that level he'll be the proud new owner of a [Bobby with a pile of stock]
00:55
hundred shares have whatever.com and if it doesn't well then Bobby bargain
00:59
hunter will have to shop elsewhere for bargains yeah this guy's such a big
01:03
bargain hunter he even hackles at restaurants can you believe that [Waiter approaches Bobby with the check]
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