43

A limit order is an order to buy or sell a product at a specific price or better. For a buy order, you might buy for lower than the limit. For a sell order, you might sell for more than the limit. If you have a buy order at $10 in your example, then you are already covering every price increment up to that price with your limit order; someone may sell to you ...


21

In a reply to one of the comments, you state: "Isn't [getting the transactions filled] a good thing? Isn't that the whole point of placing an order and being the first in line? What's the point of placing orders if they never get transacted?" The point of placing an order isn't just to 'get it filled', it's to get it filled at a price you are happy ...


18

Stop orders wait until a particular (adverse) condition is met before turning into a limit order. On the sell side: If the price is currently $40 and you submit a limit order to sell at $36, it will immediately execute at $40 because this is even better than $36. If the price is currently $40 and you submit a stop-limit order to sell at $36, it will wait ...


17

The earliest order is the price. If the seller submits a Limit Order to Sell at $10 at 9:30 AM, it will enter the order book and $10 will be shown to the world as Best Ask. Then if the buyer submits a Limit Order to Buy at $20 at 9:31 AM, it becomes a Marketable Limit Order because $20 is better than the Best Ask of $10. The trade will be executed at $...


14

The investopedia article gives a decent example: For example, assume that ABC Inc. is trading at $40 and an investor wants to buy the stock once it begins to show some serious upward momentum. The investor has put in a stop-limit order to buy with the stop price at $45 and the limit price at $46. If the price of ABC Inc. moves above $45 stop price, the ...


9

It would make sense for an investor or trader to place a limit order in advance to close an existing position at a better price. For new positions, traders might be less inclined to have limit orders on the books because they could be blindsided by adverse news and while their fill would be better than current price, it could end up being a poor fill (think ...


8

A person executing a single order during a flash crash would not be high on the suspect list for the cause of the crash, so no, I wouldn't worry about it at all. There is nothing wrong with taking advantage of whipsawing prices as long as you didnt cause them.


8

There is no effect. Given that the last price is $500, there should be existing bid/ask orders creating a reasonable spread. For example, bid is $499 and ask is $501. Any limit order to sell entered at price below $499 will be executed at $499. In other words, even if you entered $5, it will be sold at $499. That is unless you are selling huge amount ...


8

If you placed a limit order to buy USO at $13.22 and your fill price was $13.38 then: You placed the order incorrectly (a market order?) You're looking at the cost basis which includes the commission Your broker screwed up Call your broker for clarification.


7

Nothing is wrong and it should be profitable - but it sounds too good to be true. The devil is in the details and you have not described how you found those stocks. For example, you may have scanned the 500 stocks in the S&P 500, and you may have found a few that exhibit that pattern over a given time window. But it doesn't mean that they will continue ...


7

While Victor's answer might be correct for the broker's he listed, you should know that the exchanges will usally define exactly (on a per-asset, sometimes per-instrument base) how marketable limit orders (that's what they're called) are treated. I would claim that in most (all?) dealer markets the sell order would be filled at $1.00 (provided the ...


7

It depends on how you place your stop order and the type of stop orders available from your broker. If you place a stop market order and the following day the stock opens below your stop your stock will be stopped out at or around the opening price, meaning you can potentially end up with quite a large gap. If you place a stop limit order, say you place ...


7

why don't traders enter limit orders at all prices, so that they could be first in line when the price moves? Because when the price moves to your limit, you aren't "first in line": you've already made the trade. When someone agrees to your bid or ask, no one asks you if you still want to make the trade. You're obligated to make it. As such, you ...


6

Your logic breaks down because you assume that you are the only market participant on your side of the book and that the participant on the other side of the book has entered a market order. Here's what mostly happens: Large banks and brokerages trading with their own money (we call it proprietary or "prop" trading) will have a number of limit (and other, ...


6

There is no perfect answer to this question, and you will always have a tradeoff between likelihood of executing the order and the price you wish to achieve. The only way to be certain to execute the order is to sell at the bid (or more accurately at the highest bid that immediately accommodates the full volume you are trying to sell), and the market's ...


6

A buy limit order is an order to purchase a security at or below a specified price. That guarantees that you pay no more than your limit price. The only downside risk that you face is that your order is filled and the security's price then drops like a rock. However, that's investment risk and it that has nothing to do with the level of quotes that you ...


5

On most exchanges, if you place a limit order to sell at 94.64, you will be executed before the market can trade at a higher price. However most stocks in the US trade across several exchanges and your broker won't place your limit order on all exchanges (otherwise you could be executed several times). The likeliest reason for wht happened to you is that ...


5

TD will only sell the stock for you if there's a buyer. There was a buyer, for at least one transaction of at least one stock at 96.66. But who said there were more? Obviously, the stocks later fell, i.e.: there were not that many buyers as there were sellers. What I'm saying is that once the stock passed/reached the limit, the order becomes an active order....


5

I don't have all the answers. On a illiquid stock, such situations do arise and there are specific mechanisms used by exchanges to match the order. It is generally not advisable to use market order on illiquid stock. There are lots of different variations here. I guess this comes down to specifications for individual exchanges, but I'm wondering if there'...


5

This is sometimes called a bracket order and can be done for stocks. It is offered by some brokers, but not all. It does take slightly more sophisticated infrastructure for the broker to support, so not all of them might bother, especially in crypto. As a note, if brackets are not supported but you have access to options, a vertical spread should provide ...


5

In the absence of liquidity, the market maker sets the price because hardly anyone else is offering to buy or sell the security. If traders put in more competitive bids and offers, the spread narrows. The rule of law in US financial markets is NBBO (National Best Bid and Offer) so whoever is offering to buy at the highest price or sell at the lowest price ...


5

This is governed not by the brokerage but by the exchange, specifically the "opening rotation" procedure. If there is a sell (limit) order at $10 and a buy order at $11 going into the open, the first trade would probably be designated at the midpoint ($10.50) for the lesser of the two quantities. But it is unlikely that these would be the only orders. More ...


4

The SEC reference document (PDF) explains order types in more detail. A fill-or-kill order is neither a market order nor a limit order; instead it's something in between. A market order asks to be filled at the best available price, whatever that price might be when the order gets to the exchange. Additionally, if there are not enough counterparties to ...


4

Your best option would be to check with your broker. With some brokers you can select between what times of the day you want your order to be in the market. For example if you want to avoid the initial volatility in the first hour of trading, you can have a condition for your order to only be placed in the market between 11:00am to 4:00pm.


4

The next day the market opens trading at 10.50, You haven't specified whether you limit order for $10.10 is to buy or sell. When the trading opens next day, it follows the same process of matching the orders. So if you have put a limit order to buy at $10.10 and there is no sell order at that price, your trade will not go through. If you have placed a ...


4

If you want to make sure you pay at or below a specific price per share, use a limit order. If you want to buy the stock close to the current price, but aren't price sensitive, use a market order. Market orders are typically not a great idea because if you're buying thousands or tens of thousands of shares this can mean a large swing in cost if the market ...


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