Types of Orders
Chapters in this video
- 0:00 Execution certainty versus price protection
- 0:42 Core orders: speed versus price
- 1:44 Market order: the crash exit scenario
- 2:55 Stop-limit three-step mechanics and gap risk
- 3:33 Placing orders: buy limits below, sell limits above
- 4:34 Stop order does not guarantee execution price
- 5:25 Time-in-force: IOC versus FOK
- 6:19 FOK versus AON: immediacy versus patience
- 6:46 Default day order rule
- 7:05 Rapid-fire exam recap
What this video covers
- The execution certainty versus price protection tradeoff and which order types sacrifice each
- How market, limit, stop, and stop-limit orders work, including the exact memory aid phrases for each
- Where buy limits and sell limits sit relative to current market price, and why the exam constantly reverses these
- Why a stop order does not guarantee execution price once triggered, and how a stop-limit order adds price protection at the cost of possibly not executing
- The difference between immediate-or-cancel (IOC) and fill-or-kill (FOK): both act immediately, but only IOC allows partial fills
- How fill-or-kill (FOK) differs from all-or-none (AON): both demand full fills, but only FOK requires immediacy
- Why day order is the default time-in-force when none is specified, and when each designation expires or cancels
Read the full lesson, free
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