What do you mean by Stock Order in the Share Market?

1. Market Order

A market order makes purchases or sells at the current market price of the shares.
Here, the trader or investor does not have control over the price but there is a very high chance that the trade will get executed very soon.

• If you place a Buy order the shares will be bought at the current maximum asking price in the trade book.
• If you place a Sell order the shares will be sold at the current minimum bidding price in the trade book.

Example

You want to purchase 1000 shares of ABC Ltd. at a market price of Rs.100
Considering the market dept of a share, it will match this trade with the maximum asking price available.
If the asking price is Rs.100 for 500 shares and 99 shares for Rs.500, the trade will be executed at Rs.100 for 500 shares and then Rs.99 shares at Rs.500.

2. Limit Order

A limit order is where the trader can set a predetermined rate to purchase or sell a share.
These orders are mainly useful for traders who are not actively following the price movement and have a predetermined share price in their minds. The execution of the trade is not certain, it will be executed when the shares reach the already set price.
For Example
If you place a trade to purchase/sell one share at Rs.100, it will be executed when the market price of the share reaches up to Rs.100.

3. Stop Loss Order

A stop loss is where traders can limit their losses by exiting the trade if the share reaches the trigger price.
By placing a stop loss, you can save yourself from high losses if the price of a share increases or decreases suddenly.

Types of Stop Loss Orders

• 1. Stop loss Market Order

Stop loss market order is almost similar to stop loss where the trader sets a trigger price to exit the trade at the best possible available price.
Here, as soon as the trigger price is about to reach, a market order is created and executed at the market price immediately.
For Example
Let us assume that there is a sell position at Rs.100 and the trigger price for stop loss is placed at Rs.95. If the stop loss is triggered, the shares will be purchased at the best possible price in the market.

• 2. Stop Loss Limit Order

This is a specific type of trade where the order is sent to the exchange after the trigger is hit is a stop-loss limit order, i.e. the trade price has to be defined by the user previously.
For Example
Lets assume that there is a sell position at Rs.100 and the trigger price for stop loss is placed at Rs.95. If the stop loss is triggered the order will be sent to the exchange and later the trade would be executed at the set price of Rs.95.

4. AMO (After Market Order)

AMOs are the trades that are placed after the market becomes closed.
It is very important for the traders who do not have enough time to actively participate in the stock market but do not want to miss a chance of creating wealth.
Note: AMO can also be placed at Market Price.
For Example
If you want to purchase 500 shares of XYZ Ltd. at 7 am you can just simply place a trade from your trading app and that trade will be executed during the market hours if the share reaches the set price.

5. IOC (Immediate or Cancel Order)

As the name suggests, when you place an IOC trade, if it isnt executed immediately as soon as it is placed on the exchange, it will be cancelled.
An IOC trade is very much useful for traders if you frequently place trades and are not able to monitor each trade closely.
For Example
If you buy an IOC trade for Rs.1000 of ABC Ltd. at Rs.100. As soon as the trade is entered, if 700 shares are available at Rs.100 it is executed and 300 shares would be cancelled.

6. Cover Order (CO)

Cover order is one of the kinds of orders where you can enter into a position along with stop loss in that same trade.
You can select the type of stop-losses according to your choice - Limit or Market stop loss.

7. Bracket Order (BO)

Bracket order is a type of trade where 3 orders are added into one. Here, you can place your trade with a target price and a stop loss. Note: All Bracket trades are Limit orders.
For Example
If you want to purchase a share at Rs.100 with a target price of Rs.110 and a stop loss of Rs.95 i.e. you can place it all in 1 trade with a bracket order.

8. CNC

CNC stands for Cash and Carry where you can purchase and sell delivery of shares only.
Note that cash and carry method can be placed at both Limit Price and Market Price.
If you want to purchase shares and sell them after some time, you should use the CNC as the order type.

9. MIS

The full form of MIS is Margin Intraday Square off. MIS is an intraday product and they have to be squared off during the same trading day.

If you know the different types of stock orders it will be very useful not only while trading in equities but also while trading in other segments like currency and commodities.
Today, when the world is moving towards digital and most traders prefer trading on their own, having such in-debt information is not only going to help you to trade easily but also boost your confidence level. Now if you have understood the different types of stock orders, you can start by placing your first trade in the market! But if you have still some doubt regarding different types of stock market orders click here.