by Gerdie Maple

What kinds of trades do you hope to execute? Most advisors suggest you start with simple trades. Options trading, selling stocks short, and other complicated trades require more experience. In some market conditions, execution may be at a price significantly different from the current quoted price. Limit orders will be executed only at a specified price or better. Customers using limit orders receive price protection, but with the possibility the order will not be executed.

This kind of price fluctuation is especially common in very hot stocks such as IPOs. Initial public offerings commonly have rapid changes in price due to the very high volume of trading for a new offering. There are delays in quotes, since the trading is simply happening too fast for quotes to keep pace in real time. This has led many novice investors to pay a lot more than they had anticipated …