Everyone out there has thought of a luxurious life like billionaires. People like Bruce Wayne with his trusted butler Alfred are the goals of many if they want to become rich. After all, nothing says luxury than having someone to order what to do. But in the market world, “order” has a different meaning altogether.
Order in the market world is something that is used for the investor to his/her broker. And there is more than one type of orders available for an investor. Thus we made this list of every type of order available to understand for you.
What Is A Market Order?
An order, is exactly as its name implies, is an order to broker and its firm to buy or sell a stock. All of which will be done on the investor’s behalf. You have the option of placing your orders through phone or online web trading platforms.
You should note that orders do fall into different types. The traders will have an opportunity to take more control of their orders by choosing the price and time on when their orders can be executed. The trader will then have full reign on whatever he decides to do with the security. You can either go fast or slow with your orders.
Investors need a broker. Regardless of experience, a trader needs to utilize trades through their broker to regulate proper ruling. Although the investor/trader has full reigns to decide what he wants to buy or sell. And the broker can only provide advice and oblige to his/her final decisions. Thus the investor will inform the broker with their list of instructions on how and where to proceed from there.
The exchange process then trades securities through a bid/ask process. Remember that to buy or sell a currency you must do the opposite at the same time. Meaning whenever you buy a currency, you must sell the other.
The highest possible price that has been declared will become the bid of the security. And the lowest price that’s been advertised will be considered the ask. Both the bid and the ask are constantly changing. The more orders are being taken, the more volatile the bid-ask prices are.
Market Order Types
Orders are what track the trades that are finalized into an official setting. However, there are multiple kinds of order types for different kinds of orders placed. They are organized as such to prevent any sort of mishappenings that can arise from poor management.
The order types are as follows: Limit Buy Order Type, Limit Sell Order Type, Sell Stop Order and Buy Stop Order. All those are what is used by the both the brokers and the traders to signify what kind of trade strategy they will implement. Afterward, they shall then file the order on the appropriate market function and start trading.
Without any order type categorizing by the market and institutions, the entire trading scene could end up being in disarray. So it is imperative that you learn the different types of orders to maximize the trade potential of your orders.
Market Orders are the life and soul of the marketplace. They are the reason that the market remains as fruitful as it has been throughout these past couple of years. However, it should always be noted that if you conduct business on the market, make sure to use official market orders to prevent any form of issues or violations.