Bracketed Buy Order
A buy order that is accompanied (or "bracketed") by a sell limit order above the buy order's price and a sell stop order below the buy order's price. These three component orders will all be set at a price determined by the investor entering the order. The bracketed buy order allows investors to lock in profits with an upside movement and prevent a downside loss, and does not require investors to constantly follow the position.
Investopedia Commentary
Here's an example of a bracketed buy order: an investor places a buy order for 100 shares of ABC at $50, along with a sell limit order at $55 and a sell stop order at $45. If the price moves up to $55 or down to $45, the position will be sold. The trader will either meet a specified gain of $5 with the sell limit or suffer a maximum loss of $5 with the stop-loss order.
Related Links
The Basics Of Order Entry
The Stop-Loss Order - Make Sure You Use It
Trailing-Stop Techniques
See also: Limit Order, Market Order, Order, Sell, Stop Order, Stop-Loss Order, Stopped Out