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AirJer
04-07-2011, 02:31 PM
Can someone explain the concept of a stink bid and how to execute an example order?

My current understanding is that a stink bid is an order placed well below the current value of a particular stock on the hope that some or all of the order will be filled if there is a drop in price of the stock, bring it down to the level of your bid. Is this correct?

If so, this type of order would not be a type of market order, so is it some type of limit order? Can someone clarify here?

Thank you.

theplantguy
04-07-2011, 02:54 PM
it's just a limit order at a price of your choice. But if it executed and the stock kept going down, what would you have gained?

galtbob
04-08-2011, 09:36 AM
Been trading 20 years, never heard the term until I got interested in coins.

If you want to place limit orders well below the market, consider selling naked puts. They have their good and bad points, but can bring you some income while you wait.

sliver573
04-08-2011, 09:47 AM
If you want to place limit orders well below the market, consider selling naked puts. They have their good and bad points, but can bring you some income while you wait.

What is a covered put (as opposed to a naked one)

galtbob
04-08-2011, 10:30 AM
A covered put is when you are short the stock and then sell a put against it. If you get the stock, you are then flat.

sliver573
04-08-2011, 10:30 AM
I see, thanks