#OrderTypes101 Here is a quick overview of the most common order types in trading (stocks, crypto, etc.):
🔹 Market Order
Definition: Buy or sell immediately at the best available price.
Use When: Speed is more important than price.
Risk: You could be executed at a less favorable price in volatile markets.
🔹 Limit Order
Definition: Buy or sell at a specific price or better.
Use When: You want to control the price.
Risk: It may not be executed if the market does not reach your price.
🔹 Stop Order (Stop-Loss)
Definition: Becomes a market order once a trigger price is reached.
Use When: You want to limit losses or secure gains.
Risk: May execute at a less favorable price than expected in fast markets.
🔹 Stop-Limit Order
Definition: Combines a stop price with a limit price. Executes only at your limit price after the stop is triggered.
Use When: You want more control than a regular stop.
Risk: It may not be filled if the market moves quickly beyond your limit.
🔹 Trailing Stop Order
Definition: A dynamic stop that follows the market price by a fixed percentage or amount.
Use When: You want to let profits run while protecting against downside.
Risk: Like a stop order, it can execute at an unfavorable price during sharp moves.
🔹 Fill or Kill (FOK)
Definition: Must be filled immediately in full or not at all.
Use When: You need a large position and partial fills are not acceptable.
Risk: May not execute at all.
🔹 Good Until Canceled (GTC)
Definition: Remains open until filled or manually canceled.
Use When: You want a permanent order in the market.
Risk: It may be forgotten and trigger unexpectedly later.