If you want to buy or sell stock at a specified price, you can place a limit order with your broker. A limit order allows you to set the maximum or minimum price at which you are willing to buy or sell a stock, and also allows you to decide how long you want the order to remain open before it is canceled.

When you have a limit order to buy stock, your broker can only purchase stock at the specified price or lower. Similarly, your broker can only execute a limit order to sell when the stock is at the limit price or higher. By contrast, you cannot control the price at which your broker will fulfill your request with a market order.

The advantage of placing a limit order rather than a market order with your broker is that you have more control over the amount of money you end up spending on your transaction. For example, if you initially bought stock at $89 a share and you place a limit order of $100 on the stock, your broker will be able to purchase additional stock up to that $100 limit amount. Investors often use limit orders when dealing with securities that are considered low volume or volatile. Unless you specify otherwise, most brokers will perform transactions using market orders, which tend to be less expensive than limit orders. By using a limit order, however, you can avoid buying the stock if the price is too high. On the other hand, there is no guarantee that your broker will buy or sell your stock with a limit order. To read more about limit orders, visit www.sec.gov.