what is an example of a stop limit order used for a short position 
a short position would necessitate a buy stop limit order to cap losses for example if a trader has a short position in stock abc at 50 and would like to cap losses at 20 to 25 they can enter a stop limit order to buy at a price of 60 and a limit price of 62 50 if the stock trades at a price of 60 to 62 50 then the stop limit order will be executed capping the trader s loss on the short position in the desired 20 25 range however if the stock gaps up say to 65 then the stop limit order will not be executed and the short position will remain open 