Methodology

Risk Management

If an investor buys a stock at $100 and sets a stop loss at $95, what would happen if a stock dropped in value to $90?

The stock would automatically be sold at $95.
The stop loss would not be triggered as the stock devalued by more than the value of the stop loss order.
The stock would automatically be sold at $90.
The stock would automatically be sold at $100.

If an investor buys a stock at $100 and sets a stop loss at $95, what would happen if a stock dropped in value to $90?

The stock would automatically be sold at $95.
The stop loss would not be triggered as the stock devalued by more than the value of the stop loss order.
The stock would automatically be sold at $90.
The stock would automatically be sold at $100.

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