To avoid buying or selling a stock at a price higher or lower than you wanted, you need to place a limit order rather than a market order. A limit order is an order to buy or sell a security at a specific price. A buy limit order can only be executed at the limit price or lower, and a sell limit order can only be executed at the limit price or higher. When you place a market order, you can't control the price at which your order will be filled.

For example, if you want to buy the stock of a "hot" IPO that was initially offered at $9, but don't want to end up paying more than $20 for the stock, you can place a limit order to buy the stock at any price up to $20. By entering a limit order rather than a market order, you will not be caught buying the stock at $90 and then suffering immediate losses as the stock drops later in the day or the weeks ahead.

Remember that your limit order may never be executed because the market price may quickly surpass your limit before your order can be filled. But by using a limit order you also protect yourself from buying the stock at too high a price.

Online trading is not always instantaneous

Investors may find that technological "choke points" can slow or prevent their orders from reaching an online firm. For example, problems can occur where:

• an investor's modem, computer, or Internet Service Provider is slow or faulty;

• a broker-dealer has inadequate hardware or its Internet Service Provider is slow or delayed; or

• traffic on the Internet is heavy, slowing down overall usage.

A capacity problem or limitation at any of these choke points can cause a delay or failure in an investor's attempt to access an online firm's automated trading system.

Know your options for placing a trade if you are unable to access your account online