Trading Securities: Rapid Fire
Chapters in this video
- 0:00 Market vs. limit: the speed-price trade-off
- 0:48 Where each order sits: below or above the market
- 1:43 Stops, stop-limits, and the slippage trap
- 2:12 Margin math: 50% initial, 25% maintenance, $2,000 floor
- 3:41 Brokers, dealers, spreads, and payment for order flow
- 5:11 Settlement, free-riding, and the 90-day freeze
- 5:59 Rapid-fire exam recap
What this video covers
- Why a market order guarantees execution but not price, and a limit order guarantees price but not execution
- Where buy limits, sell limits, buy stops, and sell stops sit relative to current market price
- How stop orders become market orders at the trigger (slippage risk), while stop-limits become limit orders that may gap through unfilled
- Why short sales require a margin account, not a cash account, and the unlimited loss potential
- How Regulation T sets 50% initial margin, FINRA sets 25% maintenance for long positions, and the $2,000 minimum equity floor applies regardless of position size
- How compensation reveals capacity: commission means agency broker, markup or markdown means principal dealer, and market makers always trade as principal
- Why payment for order flow (PFOF) is legal and disclosed but must never override the duty of best execution through reasonable diligence
Read the full lesson, free
This video's complete written lesson is free to read in the CertFuel app, no signup wall. The complete Series 65 course also includes adaptive practice questions and spaced-repetition flashcards, free through December 31, 2026.