I'd like to place limit orders, so that I can minimize my losses without constantly watching the market.
For example, let's say I buy Yes stock in "Will
Hillary Clinton win the 2016 U.S. presidential election?", but I only want to hold it if it remains above $0.40. If it dips below that number, I want PredictIt to automatically liquidate my holdings. This would prevent me from losing all of my money in the event of a total market collapse (e.g. some scandal happens that destroys her career).
Limit orders are already the default order type on PredictIt. What you're describing is known as a stop-loss order:
That would basically eliminate risk, which would defeat the purpose of the entire site.
Stop-loss orders exist in the real-world stock market (and futures/derivatives markets, etc.)... does that defeat the purpose of the entire global financial system? Absolutely not. This order type does not eliminate risk - it merely gives another method for mitigating it. Continuing the example in the original post, if the price does indeed fall below $0.40, this would activate the stop-loss order, which would cause the Yes shares to be liquidated at the best available price. There's no guarantee as to what that price would be. If there aren't any buyers of Yes until $0.25, then that's the price the trade will get executed at, so the OP would lose a full 37.5% beyond the activation price of the order. It very well could also be executed at $0.39. Or $0.01. So the risk is certainly still there. This order type is just a good way to not have to sit at your desk and refresh the prices every minute.
There's also the stop-limit, which, instead of triggering a market order (to liquidate the position), would trigger a limit order, preventing the execution price from being lower than a certain amount. I would strongly advise you to do some research on how all these order types are used in real financial markets.