#OrderTypes101
Here are the basic order types you should know:
*Common Order Types*
- *Market Order*: Buy or sell a security at the current market price. Execution is guaranteed, but price isn't.
- Example: Buying 100 shares of a stock at the current market price.
- *Limit Order*: Buy or sell a security at a specific price or better. Price is guaranteed, but execution isn't.
- Example: Buying 100 shares of a stock at $50 or less.
- *Stop Order*: Buy or sell a security when it reaches a certain price (stop price), becoming a market order.
- Example: Selling 100 shares of a stock if it falls to $40 to limit losses.
- *Stop-Limit Order*: Buy or sell a security when it reaches a certain price (stop price), becoming a limit order.
- Example: Buying 100 shares of a stock if it reaches $50, with a limit price of $52.
*Advanced Order Types*
- *Trailing Stop Order*: Adjusts the stop price based on the security's price movement.
- *Bracket Order*: A group of orders designed to limit losses and lock in profits.
- *Conditional Order*: Automatically submitted or canceled based on specified criteria.
- *One-Cancels-Other (OCO) Order*: A pair of orders where one order cancels the other if executed ¹ ².
*Time-in-Force Options*
- *Day Only*: Order is active for one trading session.
- *Good Till Canceled (GTC)*: Order is active until filled or canceled, up to a specified time limit.
- *Fill or Kill (FOK)*: Order must be executed immediately or canceled ².