Order

DEFINITION of Order

The order is a request sent to a broker or trading platform to make a trade on a financial instrument.

WHAT IT IS IN ESSENCE

This is an instruction to buy or sell on a trading venue such as a stock market. Also, the bond market, the commodity market. Or financial derivative market or cryptocurrency exchange.

These instructions can be simple or complicated and can be sent to either a broker or directly to a trading venue via direct market access.

There are some standard instructions for such orders.

The company who receives the order will then attempt to ‘ fill’ it before it expires. Orders that have not been closed are open orders.  Usually, orders will be given over the phone or online.

Orders vary in the length of time they can remain open for, and stipulations for how they can be filled.

Market orders, for instance, request your broker to trade an asset at the best available price before the end of the day. Stop and limit orders stipulate the price at which the asset should be bought or sold.

HOW TO USE

Getting used to all the trading orders can be a bit confusing at first, and there are more order types than this!.

Putting out the wrong order type when money is on the line can cause big problems.

The best way to get used to these order types is to practice using them. Open a demo trading account and try them all.

See how they function and how you will incorporate them into your trading strategy.

All trades are made up of separate orders that are used together to make a complete trade. All trades consist of at least two orders: one to get into the trade, and another order to exit the trade. Order types are the same whether trading stocks, currencies or futures.

The trader knows that entry and exit matters a lot