Let's say there are 5 sell orders in the order book. 101 102 103 104 105 , current price is 101

If I place a limit buy for 103, does it get execute at current price at 101 or does it get filled immediately as 103?

If the order get filled immediately won't that be consider a taker and subject to taker fee?

If the order doesn't get filled immediately but eventually match with an existing order and get filled, it's taking away from the order book, am I now a taker?

1 Answer 1


The simple answer is that of course a limit order can be a taker otherwise no one would ever pay taker fees and every order would be a limit to avoid fees. The maker fee rules will include a minimum amount of time either a given order or the average over the day must be on the book to receive maker fees.

The more complicated answer is that some orders can be both.

Let's expand your market depth to include volume and including current best bid @ 90 (ignore the wide spread):

side price quantity
bid 90 10
ask 101 1
ask 102 1
ask 103 1
ask 104 1
ask 105 1

so you enter your order at 103 for 5 lots the order book will end up as:

side price quantity
bid 90 10
bid 103 2
ask 104 1
ask 105 1

so 2 lots of your order is left on the book. Those 2 lots will, on most exchanges if they remain unmatched long enough, attract maker fees and you will pay taker fees on the other 3 lots. Congratulations; you are now best bid.

So the real answer is that if you enter a limit order that takes all of the liquidity on the other side it will incur taker fees for obvious reasons - otherwise the exchange would never be paid any fees. If your order will partially take all of the liquidity at its price and then become the best bid/ask it can both receive maker and pay taker fees.

  • From what you're saying, it seem that the only way to become a market maker is to be place on the order book before any opposing counter party that match the same price. Is that correct?
    – John Adams
    Feb 1 at 20:30
  • This is a really good answer. It's clear with a good example of marker/taker. Feb 1 at 21:16
  • @John Adams - If you place an order making you the best bid (or ask) then you are the market. If you do it before anyone else, then you have time and price priority. Feb 1 at 21:17
  • @JohnAdams I'd check the exact rules for the exchange but essentially the way to become a market maker is that some of your lots are on the book before the lots belonging to the participant you match with are entered or amended
    – MD-Tech
    Feb 2 at 6:52
  • @BobBaerker Thank you, I've been working on my didactics this week. I suppose its easy to guess what I do for a living too.
    – MD-Tech
    Feb 2 at 8:37

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