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CFA Level 2
Equity Investments

Optimal Order Type for Earnings Announcement Scenario

Very Hard Equity Market Structure Order Types And Instructions

In today's fast-paced equity markets, various order types are utilized by traders to manage their investments effectively. Consider a trading scenario in which an investor wants to purchase shares of stock in a company that reports earnings after the market closes. The investor believes there will be significant movement in the stock price due to the earnings announcement but is unsure of the direction. To avoid potential losses stemming from a poor entry price, the investor is contemplating using an order type that provides both flexibility in price execution and protection from adverse market movements.

Which of the following order types would best suit the investor's needs in this scenario?

Hint

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