Capital Standard

Capital Standard Corporation - Order Entry HandBook

The types of orders most commonly used are briefly described below:

Market Order

The market order is the most frequently used order. It is a very good order to use once you have made a decision about opening or closing a position. It can keep the customer from having to chase a market trying to get in or out of a position.
The market order is executed at the best possible price obtainable at the time the order reaches the trading pit.

Limit Order

The limit order is an order to buy or sell at a designated price. Limit Orders to buy are placed below the market while limit orders to sell are placed above the market. Since the market may never get high enough or low enough to trigger a limit order, a customer may miss the market if he uses a limit order.
(Even though you may see the market touch a limit price several times, this does not guarantee or earn the customer a fill at that price. In most instances, the market must trade BETTER than the limit price for the customer to get a fill.)

Stop Order

Stop orders can be used for three purposes:

a. to minimize a loss on a long or short position,

b. to protect a profit on an existing long or short position, or

c. to initiate a new long or short position.

A buy stop order is placed above the market and a sell stop order is placed below the market. Once the stop price is touched, the order is treated like a market order and will be filled at the best possible price.

PLEASE NOTE; WHILE STOPS ARE NORMALLY ELECTED ONLY WHEN THE SPECIFIC PRICE IS TOUCHED, THEY CAN BE ELECTED WHEN THE OPENING OF A MARKET IS SUCH THAT THE PRICE IS THROUGH THE STOP . IN THIS CASE, THE CUSTOMER CAN ROUTINELY EXPECT THE FILL TO BE MUCH WORSE THAN THE ORIGINAL STOP . THIS APPLIES TO STOP ORDERS PLACED BEFORE THE OPENING OF TRADING.

One Cancels Other (OCO)

This is a combination of two orders written on one order ticket. This instructs our personnel that once one side of the order is filled, the remaining side of the order should be cancelled. By placing both instructions on one order, rather than two separate tickets, the customer eliminates the possibility of a double fill.

Cancel

A Cancel order instructs the broker to disregard an order which you previously entered but no longer want. Tell your order specialist that you want to cancel an order and tell him what the instruction on that order is. When he locates the order, your order specialist will confirm the cancellation with you.

IF YOUR ORDER WAS FILLED BEFORE YOUR CANCELLATION REACHES THE BROKER, YOUR ORDER RETURNED AS "TOO LATE TO CANCEL".