#OrderTypes101 $BNB Market Orders:
Definition:
A market order instructs the brokerage to buy or sell immediately at the best available market price.
Guarantee:
Ensures execution but does not guarantee a specific price.
Use:
Ideal for trades where you want to execute quickly without waiting for a specific price.
Example:
If you want to buy 100 shares of XYZ stock immediately, a market order would execute the trade at the current market price.
Limit Orders:
Definition:
A limit order specifies a maximum price to pay (for a buy order) or a minimum price to receive (for a sell order).
Guarantee:
Only guarantees the order will be filled at the limit price or a better price (e.g., lower for a buy order, higher for a sell order).
Use:
Allows traders to set a price limit, ensuring they don't overpay or undersell.
Example:
If you place a buy limit order for XYZ stock at $50, it will only be executed if the price drops to $50 or lower.
Stop Orders:
Definition:
A stop order becomes a market order once the price of the security reaches a specified stop price.
Purpose:
Used to protect against losses or lock in profits by triggering a market order when the price reaches a predetermined level.
Types:
Includes stop-loss orders (to limit losses) and stop-limit orders (combines stop order with a price limit).
Example:
If you place a stop-loss order on XYZ stock at $50, and the price drops to $50, it will become a market order to sell, potentially limiting your losses.
Other Order Types:
ATO/ATC (At the Open/At the Close):
Orders that are intended to be executed at the opening or closing price of the trading day.
Iceberg Orders:
Orders that disclose only a portion of their total quantity to the market, potentially helping to avoid price impact.
Trailing Stop Orders:
Automatically adjusts the stop price as the market price changes, helping to protect against losses while allowing profits to grow.
Book-or-Cancel (BOC) Orders:
Orders that are immediately deleted if they are not executable upon entry.
