What is a market order?
In our last lesson we continued our course on the logistics of stock trading, with a look at position sizing, and how to buy and sell stocks. In today’s lesson we will continue our discussion of how to place stock trades with a look at the most basic type of order, the market order. Today’s electronic platforms give traders many options for entering and exiting trades, which include the ability to tie automatic trade parameters to your stock trades so that they will be executed, only if certain conditions are met. The most basic order type that a trader can use to enter and exit the market is what is known as a market order. A market order is an order that is sent to be executed at the current market price, regardless of what that price is when your order is executed. The advantage of using a market order is you are pretty much guaranteed to be filled on your order, regardless of how fast the market is moving. The disadvantage is that you do not know where your order will end up being
A market order is an order to buy or sell a stock at the current market price. A broker enters an order as a market order when requested to do so by his or her client. When a market order is placed, it is almost guaranteed that the order will be executed. Ultimately, however, this depends on whether or not there is a willing buyer or seller. A market order is usually less expensive than a limit order. A limit order is an order to buy a security at a price no greater than what has been specified by the owner. This gives the customer control over the price of the trade. A buy limit order can only be executed by the broker. It also has to meet or fall short of the limit price. One disadvantage of a market order is that the price is paid when the order is executed. The price may not always be the same as that presented by a real-time quote service. This often happens when the market is changing very quickly. Placing an order “at the market,” especially when it involves a large number of sh
A market order instructs us to buy or sell securities for your account at the next available price. A market order remains in effect only for the day, and usually results in the prompt purchase or sale of all the shares of stock, option contracts or bonds in question, as long as the security is actively traded and market conditions permit.
A market order is an order to buy or sell a security at the available market price. When placed during market hours (9:30am to 4:00pm ET), a market order will be processed immediately. Market orders placed during non-market hours will be entered when the market opens. Note: There may be a short delay between the time your trade is completed and the time your positions are updated online. The commission for placing a market order will depend on the pricing program you have selected. For full commission details, please see the ShareBuilder Pricing & Rates.
