Market Orders — Speed Over Control
A market order executes immediately at the best available price. It's fast, but you're guaranteed the current price — not the price you saw when you clicked. In fast markets, this gap (called slippage) can be meaningful.
Limit Orders — Control the Price
A limit order lets you specify the maximum price you'll pay (when buying) or the minimum price you'll accept (when selling). The order sits in the book until someone crosses it. You might wait longer, but you'll never pay more than you planned.
Stop Orders — Triggers, Not Guarantees
A stop order becomes a market order once a price threshold is hit. A stop-loss sell protects a long position — you set it below your entry, and if the price drops to that level, the sell fires automatically. A stop-buy can trigger a breakout entry, buying only when price confirms upward momentum.
Good-Till-Cancelled vs. Day Orders
Orders also have a lifespan. A GTC order stays live until executed or manually cancelled — useful for limit orders on key levels. A day order expires at market close, which is the default for most retail platforms.
Partial Fills
Large limit orders sometimes fill partially. If you're buying 1,000 shares at $50 and only 600 are available at that price, you get 600 now and the rest stays open. Keep this in mind when sizing positions.
Key Takeaways
- Market orders: fast execution, no price guarantee — use in liquid stocks only
- Limit orders: price control, no guarantee of execution — use when you have a specific entry in mind
- Stop orders: execution trigger, not an order to execute at a specific price
- Slippage compounds in volatile markets — limit orders reduce surprise costs
- Know your order's time window: day orders die at close, GTC stays live
Next Lesson Preview
Who actually makes the market move? In Market Makers & Liquidity, you'll meet the firms that keep the order book flowing — and the role they play in the price you get.