Types of Trading Orders
There are quite a few different kinds trading orders. First off, a couple of things to remember about orders in general: the same order could have different meanings depending on if it's executed in pit trading or through an electronic exchange; secondly, not every exchange accepts all types of orders so if you're not sure how to enter an order, check with your broker.Market Orders are the most commonly used order. It's a good order to use once you've decided on opening or closing a position. Market orders are executed at the best possible price obtainable at the time the order reaches the trading pit. Limit orders are used to buy or sell at a specific price. Limit orders to buy are set below the market and limit orders to sell are set above the market. Remember here that the stock market may never get high enough or low enough to put a limit order into action so you could miss the market if you use a limit order. If the order price is lower or below the current market price when buying, this is called a buy limit. If the order price is higher or above the current market price when selling, it is called a sell limit.
