📘 #OrderTypes101 – Understanding the Basics

❓ What is an Order?

An order is an instruction you give to your broker or trading platform to buy or sell a security.

➡️ The most common type is a Market Order, which means:

🟢 Buy/Sell immediately at the best available price

⚡ Prioritizes speed over price accuracy

📉 May execute higher or lower than expected depending on market movement

🧩 Types of Orders in Trading:

1️⃣ 🟢 Market Order

💼 Instant Execution

📈 Buys or sells at the current market price

✅ Use when immediacy is more important than price

2️⃣ 🛑 Stop Loss Order

❗ Automatically sells a security when it reaches a certain price

🔐 Protects you from larger losses

✅ Ideal for risk management

📉 Example: You bought a stock at $50 and set a stop loss at $45. If the price drops to $45, the system sells it to prevent further loss.

3️⃣ 🎯 Take Profit Order

🟩 Automatically sells when the price hits your target profit

💰 Locks in gains

✅ Great for profit-taking strategy

📈 Example: You bought at $50 and set a take profit at $60. If the price hits $60, it auto-sells and secures your profit.

4️⃣ 🧭 Limit Order

🛒 Set a specific price at which you want to buy or sell

⌛ May take time to fill or might not fill at all

✅ Best for those who want price control

⚙️ Example: You want to buy a stock only if it drops to $45, not higher. You place a limit buy order at $45.