In trading, the types of orders define how a buy or sell request is executed. The most common types are market orders, limit orders, and stop orders.
Types of orders and how they work:
Market Order:
It is executed immediately at the best available price in the market.
It ensures execution but does not guarantee the price.
Limit Order:
Allows specifying a maximum price (in a purchase) or minimum price (in a sale).
It is executed only if the price reaches or exceeds the specified price.
It may not be executed if the price does not reach that level.
Stop Order:
It is activated when the price reaches a previously defined "stop" price.
Once activated, it becomes a market or limit order.
It helps to protect against losses or secure profits.
Other types of orders:
Pending Order: Executed in the future, when the price reaches a certain level.
OCO Order (One Cancels Other): Two orders are placed simultaneously, and if one is executed, the other is canceled.
Buy/Sell Order: Specifies whether to buy or sell an asset.
In summary, the types of orders allow control over price, execution, and risk when performing operations in the market.