Types of Orders
Client terminal allows to prepare requests and request the broker for execution of trading operations. Moreover, terminal allows to control and manage open positions. For these purposes, several types of trading orders are used. Order is a client's instruction to brokerage company to perform a trade operation. In the terminal, orders are divided into two main types: market and pending. Besides them "Stop Loss" and "Take Profit" are available.
Market Order
Market order is an instruction given to a brokerage company to buy or sell a security. Execution of this order results in the execution of a deal. The price of a deal depends on the execution mode, which depends on the symbol type. Generally, a security is bought at the Ask price and sold at the Bid price.
Pending Order
Pending order is the client's instruction to a brokerage company to buy or sell a security at pre-defined conditions in the future. The following types of pending orders are available:
- Buy Limit — trade request to buy at the Ask price that is equal to or lower than that specified in the order. The current price level is higher than the value in the order. Usually this order is placed in anticipation of that the security price, having fallen to a certain level, will increase;
- Buy Stop — trade request to buy at the Ask price that is equal to or higher than that specified in the order. The current price level is lower than the value in the order. Usually this order is placed in anticipation of that the security price, having reached a certain level, will keep on increasing;
- Sell Limit — trade request to sell at the Bid price that is equal to or higher than that specified in the order. The current price level is lower than the value in the order. Usually this order is placed in anticipation of that the security price, having increased to a certain level, will fall;
- Sell Stop — trade request to sell at the Bid price that is equal to or lower than that specified in the order. The current price level is higher than the value in the order. Usually this order is placed in anticipation of that the security price, having reached a certain level, will keep on falling;
- Buy Stop Limit — this type is the combination of the two first types being a stop order for placing Buy Limit. As soon as the future Ask price reaches the value indicated in the order, a Buy Limit order will be placed at the level, specified in the order. The current price is lower than that, reaching which the pending order will be placed.
- Sell Stop Limit — this type is a stop order for placing Sell Limit. As soon as the future Bid price reaches the value indicated in the order, a Sell Limit order will be placed at the level, specified in the order. The current price is higher than that, reaching which the pending order will be placed. The pending order price is higher than the price of its placing.
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— current market state
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— forecast
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— current price
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— order price
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— price, reaching which a pending order will be placed
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— expected growth
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— expected fall
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Take Profit
Take Profit order is intended for gaining the profit when the security price has reached a certain level. Execution of this order results in complete closing of the whole position. It is always connected to an open position or a pending order. The order can be requested only together with a market or a pending order. Terminal checks long positions with Bid price for meeting of this order provisions, and it does with Ask price for short positions.
Stop Loss
This order is used for minimizing of losses if the security price has started to move in an unprofitable direction. If the security price reaches this level, the whole position will be closed automatically. Such orders are always connected to an open position or a pending order. They can be requested only together with a market or a pending order. Terminal checks long positions with Bid price for meeting of this order provisions, and it does with Ask price for short positions.
- Take Profit and Stop Loss levels are placed for a position according to its latest order (market or triggered pending order). In other words, in every new order of the same position stop levels substitute for previous ones.
- To automate the moving of a Stop Loss order following the price, you can use Trailing Stop.
- Triggering of Take Profit or Stop Loss results in the complete closing of the whole position.
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