Market Order
Order Types
What it means
An order to buy or sell right now at the best available price. It guarantees execution but not the price you will get.
Example
A market buy for 1,000 shares of a thin stock when the asks are $10.00, $10.05, $10.20, $10.50... might fill at an average of $10.30 -- far above the $10.00 you saw.
Mistake beginners make
Beginners use market orders in illiquid or fast-moving names and are stunned by slippage. Market orders belong in liquid, calm markets only.
Related terms
- Limit Order — An order to buy or sell only at a specific price or better. It guarantees the price but no…
- Slippage — The difference between the price you expected and the price you actually got. It happens w…