Questions tagged [order-execution]

Order execution is the process of accepting and completing a buy or sell order in the market on behalf of a client. Order execution may be carried out manually or electronically, subject to the limits or conditions placed on the order by the account holder.

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9
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5answers
4k views

Why don't traders place limit orders at all prices to be first in line when the price moves?

In markets with price-time priority, why don't traders enter limit orders at all prices, so that they could be first in line when the price moves? For example, if the current best bid is $10 and the ...
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0answers
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Does the Regulation NMS Order Protection Rule apply to odd lots?

The order protection rule prohibits trade-throughs of NMS stocks during regular trading hours, but does the prohibition apply to odd lots too? If I decide to bid $408,500 for 1 share of Berkshire ...
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1answer
81 views

Why does my stockbroker allow trading at the close but not at the open?

I have an stock brokerage account at TD Ameritrade, and I noticed that it allows market-on-close (MOC) and limit-on-close (LOC) orders, but not market-on-open (MOO) and limit-on-open (LOO) orders. Is ...
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3answers
169 views

Should I buy or sell stocks during the opening and closing auctions only?

From what I see, there are a number of advantages of buying or selling stocks during the opening and closing auctions: Huge liquidity. The opening and closing auctions have the largest amount of ...
3
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1answer
93 views

US stock market: How do odd lot orders get filled if they are not advertised to the public?

I recently asked Why didn't my buy limit order become the highest bid? when my odd lot (1 share) buy limit order did not appear in the public list of bids. If odd lot buy orders do not appear in ...
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1answer
18 views

What is the relevance of price-time priority when each stock trades on many stock exchanges?

The majority of stock exchanges seem to arrange limit orders by price-time priority. This makes sense when each stock trades on only one stock exchange. If my limit order is the first in line on that ...
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0answers
59 views

Do customer orders have higher priority than market makers' orders in the US OTC stock market?

In the US OTC stock market, do customer orders have higher priority than market makers' orders? For example, a market maker is bidding on stock S at $10 for 100 shares. Assume that this is the highest ...
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2answers
66 views

Should I consider the bid-ask spread as part of the transaction cost of a market order?

When I place a market order or marketable limit order that successfully executes, should I consider the bid-ask spread as part of the transaction cost of my order? The bid-ask spread is appears to be ...
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2answers
66 views

What type of orders fit my strategy in a way that two triggers might be needed?

As a newbie on trading cryptocurrencies, I found Stop-Limit Order does no longer fit my strategy in a situation like this: Ater a huge price pump, the market price has stabilized at around $450 now. I ...
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0answers
31 views

How are stock brokers' order routing reports useful to the retail investor?

The SEC requires stock brokers to regularly publish an "order routing report" †. I see that Robinhood has published its report for Q4 2020: RHS SEC Rule 606 and 607 Disclosure. What are ...
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2answers
68 views

Can you set up a contingent order that only sells when the stock price falls to a value above the current price?

For example, say the current price is $20 a share and I have sell order for when it hits $25 while decreasing in value. So the price will have to initially pass $25 without selling, but will sell if ...
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1answer
74 views

Whose limit gets prioritized?

Imagine a stock with a high spread with only 1 buyer and 1 seller. If the stock is $1, and the seller ask is $1.10, and I am the buyer. And assume I do not know the book for the stock. If put in a ...
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1answer
35 views

purpose of making an MOC order

I'm just introducing myself to the different order types in ordering stocks, and I don't understand the purpose of an MOC order. In what scenario would making this order be useful or propitious?
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0answers
54 views

Is front-running allowed under PFOF?

I'm reading this introduction to PFOF. https://centerpointsecurities.com/payment-for-order-flow-guide/ It claims that those buying flow are allowed to front-run that flow. For example, if a customer ...
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1answer
74 views

Why are liquidity suppliers willing to provide “price improvements” when executing orders?

US stock brokers often boast of "price improvement" when speaking of their order execution quality. e.g. "95% of executed market orders received prices better than the National Best Bid ...
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1answer
37 views

What are “Other Orders” in order routing reports?

I was reading Robinhood's SEC Rule 606(a) disclosure report (Robinhood Securities - Held NMS Stocks and Options Order Routing Public Report) for Q1 2020. For orders on S&P 500 stocks in January ...
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1answer
73 views

What causes stock orders to execute outside the NBBO?

I was reading Stocks Order Routing and Execution Quality on Robinhood's help pages, which says: For example, in the third quarter of 2020, 97.53% of our customers' market orders for S&P 500 stock ...
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2answers
115 views

What is the difference between payment for order flow and ECN rebates?

In both payment for order flow and ECN rebates, one gets paid for providing liquidity. What is the difference between payment for order flow and ECN rebates? Are ECN rebates a type of payment for ...
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2answers
128 views

My share sell price is lower than the price people are buying yet no sale?

I’m trying to sell some shares at a sell price of 0.5. I can see from the buy/sell history over the past few days that shares are being purchased for 0.6 and others sold for 0.4. My question is why ...
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1answer
240 views

What are the risks of placing limit orders on illiquid securities without knowing the Level 2 quotes?

I only have access to Level 1 quotes (best bid and ask) for some illiquid securities. Suppose I place a buy limit order on such a security based only on the Level 1 quotes. What are the risks I could ...
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0answers
85 views

Can brokers fill my OTC stock orders by “trading through” and executing at inferior prices?

I am aware that FINRA-registered broker-dealers have to follow FINRA Rule 5310 (Best Execution and Interpositioning). But are OTC stocks (OTCQX, OTCQB, OTC Pink) subject to the Order Protection Rule ...
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1answer
85 views

How can I compare the order execution quality between two brokers if they don't follow the Financial Information Forum (FIF)'s template?

As explained in https://www.stockbrokers.com/guides/order-execution (mirror), the information present in SEC Rule 606 reports don't allow to compare the order execution quality between brokers. As a ...
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2answers
2k views

Did the recent trend among stock brokers to switch to commission-free stock trades result in a degradation in trade execution quality?

I read on https://www.cnbc.com/2020/08/13/how-robinhood-makes-money-on-customer-trades-despite-making-it-free.html (mirror): Before, when brokers charged commissions for each trade, they often were ...
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3answers
302 views

Quality of price when trading less than 100 shares

I am thinking about diversifying my portfolio by adding 10 new positions. Due to limited funds, I am planning on buying less than 100 shares each time. It is my understanding that since I am buying ...
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0answers
52 views

After hours matching

I put in an after hours sell order, well below the standard hours and after hours ask, on a liquid Dow futures security. The transaction did not complete. I looked in the ledger detail and found that ...
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3answers
873 views

Outstanding order in the Selling process in Degiro

If I sell my share with Order duration GTC (Good till cancelled), the order will became an Outstanding order. When it will be active to sell? Do I need to make any action to continue the selling ...
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5answers
2k views

Why ever use a market order?

I've read all the explanations online. Use market to fill quick, regardless of price. But... How that is that different from a sell limit of 0 or a buy limit of infinity? (Right, in practice things ...
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2answers
3k views

Why am I unable to buy at the ask price?

I was trying to buy ProShares Short Dow30 ETF (NYSE Arca: DOG). I put in a limit order at the ask price not the bid price since I want the order to execute all at once. The ask price is a penny more ...