In this Master Academy educational article and video, we are concentrating on different types of orders that can be placed with brokers.
We are going to look at FOUR differing types of Order.
- 1. Limit Order
- 2. Market Order
- 3. Stop Order
- Stop Exit
- Stop Entry
- 4. OCO Order
1. Limit Order
An order to BUY below the current market price.
An order to SELL above the current market price.
2. Market Order
An order to execute at current best price.
For a BUY order, this will mean buying at the offer price.
An order to execute at current best price.
For a SELL order, this will mean selling at the bid price.
3. Stop Order
An order usually used to exit an open position (Stop Exit)
BUT, can also be to enter a new position (Stop Entry)
Sell Stop Order
If LONG, the stop would be a SELL order, below market price
BUT can also be used to enter a SHORT position on a break lower
Buy Stop Order
If SHORT, the stop would be a BUY order, above market price
BUT can also be used to enter a LONG position on a break higher
4. OCO Order
OCO=One Cancels Other
TWO linked orders
When either order is executed, the other is cancelled
