Re: What are the mechanics behind a market crash?
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Do stop-loss orders always work in a meltdown?
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no. they will get you sold, but not at the price you desired.
for instance, if you stop-loss at $100 and the security is at $102 while the market all of a sudden tanks, the security may suddenly drop by 5 points to $97 which would instantly trigger the stop loss. however, you wouldn't be able to sell at $100 since nobody would be buying at that price (b/c they could buy at $97), so you'd at most get to sell at $97 if not lower
Barron
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