Top 7 Stock Market Order Types!


Stock Market Order Types[wp_ad_camp_2]

When you are the job of trading with stocks, it is very important to have a good idea about the various options that one has when it comes to selling and buying of shares. There are some types that are supported by all brokerages across all exchanges. On the other hand some types are not accepted by brokerages about which also you should be aware. Let us therefore over the next few lines try and find something more about the different types of stock market types.

Read also: How to Do After-Hours Trading?

1. Market Order

  • Market order is that type of order that is often used to execute when there is a requirement to sell or buy at the available current market price. This is perhaps the fastest way by which an order can be executed. However, there is risk involved with this type of order because there is not control over the price at which your order will be executed. However, if the movement of the stock is low the risk is much lesser. On the contrary if a fast moving stock goes up by 10% during the order execution, this could mean some trouble for the customer.

 2. Limit Order

  • The next type of order is the limit order which allow you to set a price limit. This certainly allows you to have much better control over the price at which the deal is executed. When you go in for a buy limit order then you can purchase the order at or below the limit order and in case of a sell limit order the order can be sold at rates above or at the limit order.

Read also: Simple Ways To Trade Penny Stocks

 3. Stop Loss

  • Stop or stop loss is the next type of order which gives the trader the power to add their shares if the market rises or sell them in case of a decline. The trader can also place a sell stop loss which is at a value slightly lower than the market price. In case of a market decline the buy stop price can be placed slightly above the current market price. Thus the trader can remain safe and make money in case of a fall in the stocks and increased profits when there is a rise. When the price of these stock orders are hit then they become a market order

 4. Stop Limit Order

  • The next type of order is the stop limit order which is very much similar to the stop loss order. The only difference being when these stock orders are activated instead of becoming a market order they become limit order. [wp_ad_camp_1]

 5. Trailing Stop Order

  • Another important type of order is the trailing stop order. The basic feature of this order is that instead of a static stop price these stocks have a dynamic price that adjusts itself based on the current market price of the particular stock. When there is a buy order the value of the stock decreases with the decline in the market but remains the same if there is an increase. In case of a sell stop order then the price of these stock increases with the rise in the market and remains constant in case of a decline.

 6. Trailing Stop Limit

  • The next type is the trailing stop limit. The only difference between the trailing stop and the trailing limit order lies in the name itself. When the order is activated instead of becoming a market order it turns into a limit order.

 7. Sell Short

  • Sell short is another type of order where a person sells an order hoping that the price of the stock will fall. The main concept behind this type of order is that a person borrows a stock at a rate equal to its current market price and sells it immediately. This the person must do only after agreeing that he or she will purchase the stock back at a later date hoping the price of stock falls. When a stock is plummeting one cannot sell a stock because the SEC allows selling short a stock only if it occurs on an uptick or zero-plus uptick.


Apart from the above said types there are several other important aspects of stock market order types that have to be understood. Some of them include Buy to Cover, Order Fill Amounts, Order Duration, Day Order and GTC (Good Till Cancelled) Order.

© 2016