Stocks Trading Orders
There are different types of stocks orders which a trader can use to trade in Stocks.
At the foundation of successful stocks is making use of the correct stocks order for its correct purpose. Most important things to remember about is this: Always understand the stocks orders you place. Never place a stock order which as a trader you are not entirely knowledgeable about. Given below are the some basic definitions of the commonly used types of stocks trading orders:
Types of Stock Market Orders and Stocks Pending Orders
Market Stock Trading Order
This is the most basic type of stocks order, market order is used to buy or sell at the current ask or bid stocks quote stocks price. This refers to the quoted stocks price which pops up on your stocks trading software.
This type of stocks order is used for buying or selling according to the current exchange rate quotation in Stocks, the execution is instant. The minute you want to enter a position you can buy & sell the stock at a click of a button using a stocks market order.
Entry Stocks Orders
These are stocks orders used to open a new trade after the stocks market reaches a stocks price specified by the trader.
Entry orders are used to buy or sell a stocks instrument when it attains a certain stocks price target.
When a specific stocks price level is reached or broken then a stocks entry order is executed.
These Entry Stocks Orders are used to enter a trade at a specified price level. It is almost impossible to monitor the stocks market every second and this is why an entry order can be handy. If you feel the stocks market may take a certain action, such as break through a specific stocks price level that it has been touching but it has not been able to break, you would want to use an Entry Limit Stock Order. Once the stocks market crosses your specified level, your entry limit stocks trade order is executed.
There are 2 different types of entry orders - limit stocks order and stop entry order.
These entry orders are also referred to as pending stocks trading orders.
Entry Limit Stocks Order
An order to buy or sell at a certain limit.
An entry limit stocks order can be used to buy below the current stocks price or sell above the current stocks price.
When buying, entry limit is executed when price falls to your limit zone.
When selling, entry limit is executed when price rises to your limit level.
These Entry Limit Stocks Orders are placed by traders when they expect the stocks market to bounce back after reaching the stocks price level at which the entry limit was placed.
- Buy Limit Stocks OrderSpecifies to buy at a level below the current market stocks price
- Sell Limit Stocks OrderSpecifies to sell at a level above the current market stocks price
Entry Stop Stock Order
An entry stop order to buy above the current stocks price or to sell below the current stocks price.
When buying, entry stop order is executed as the stocks market goes upward & hits the buy stop level.
When selling, entry stop order is executed as the stocks market goes down and hits the sell stop level.
- Buy Stop Stocks OrderSpecifies to buy at a level above current market stocks price.
- Sell Stop Stock OrderSpecifies to sell at a level below the current market stocks price.