Day-Around Order

  

Categories: Trading

Ever place an order with a friend going to the donut shop for a coffee and a raspberry jelly donut, but to get an apple jelly donut if the shop has run out of raspberry? Last thing you want is the coffee without the donut.

A Day-Around Order is a similar kind of securities order. It gives a contingency in order to get an execution done, since orders have to be followed explicitly by law, and a previous order must be cancelled before a new order replaces it. If, say you wished to buy 100 shares of a stock with a limit order of $5, but news comes out before the open, and that stock opens at $5.50 and starts to climb, you could put a Day-Around-Order that adds a $5.65 limit for the 100 shares. This allows for the cancelation for compliance purposes, and the execution to be completed so you still get your shares.

A market order could work to get you executed, but then you would automatically get filled if the stock opened perhaps at $6, which might be higher than your acceptable entry point.

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Finance: What is an Unsolicited Order?3 Views

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finance a la shmoop what is an unsolicited order

00:06

alright well people it's just an order like to buy or sell a stock or bond or [Definition of unsolicited orders]

00:10

derivative security that you instruct your broker to execute all on your

00:16

lonesome that is the broker or another professional did not recommend you doing [Guy stood in front of Walmart]

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that trade you did research on your own consulted alpha magazine and The Motley [The magazine on a disk]

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shelves the last time you visited Walmart and decided to make an investing

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statement based on that observation and in placing an unsolicited order you are

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legally on your own if things fail ie the broker is exempt from any liability [Exempt from liability stamp]

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for having made an incorrect or improper recommendation or whatever in real life

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brokers have so many layers of legal coverage above their recommendations [A wedding cake]

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that no it really doesn't matter if they sell you 20 bad stocks in a row you just

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have to be appropriate for what you checked on the boxes in the form that [Investment criteria checklist]

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you sent to them that well they're still likely immune to prosecution anyway yeah

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no recourse or well your only recourse is to just fire them and hire this guy [Bonzo the chimp appears]

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to pick stocks for yes yeah asking yourself well really how much worse

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could he do had your broker been the one to stumble on the many sold out signs of

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spinny things at Walmart and then she called you to suggest you buy shares of [Broker calling a client]

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spinny fidget time-wasters.com well then the order would have been

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considered a solicited one and in theory solicited orders carry a higher weight [Exempt from liability stamp is wiped away]

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of scrutiny should something go awry and regulators get involved and basically it

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duration levels and other levels of investing prowess that you proffer that

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you actually have and yeah those regulators they mean business you really [Regulator holding a baseball bat]

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don't want to be on their bad side

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