When our request to buy a stock, bond, commodity, or other security is fulfilled.
An order can be filled a number of ways. The most common way is what most of us probably think of when we think about buying stocks: we buy something and then, voila, we own it. That’s what’s called a market order, and it’s filled as soon as we put the order in. It’s like the Taco Bell of buying securities.
But sometimes the instant gratification of a market order, whether it involves commodities or chalupas, isn’t always our best strategy. Which is why orders can also be filled based on buyer specifications—like if we say we want to buy a stock, but only if its price drops below a certain dollar amount—or on more complicated and fancy stuff like algorithms. Orders can be filled partially or in full, based on what our investment strategy is and how our broker handles our account. In other words, filling an order can be nothing like buying Taco Bell. And maybe that’s a good thing.
Related or Semi-related Video
Finance: What is an All or None Order?71 Views
finance a la shmoop what is an all-or-none order oh you'd think that
spoiled brats only live on playgrounds of participation trophy cities hmm but [Boys holding participation trophies]
that is oh so sadly not true they roam the wild hallways of Wall Street
investment firms in droves and all-or-none order means that a buyer or
seller of stock either wants all of their shares bought or sold or none of
them and yes this applies to bonds preferred stocks and other random [Man discussing stocks and bonds]
hybrids as well.....A buyer has a portfolio of 500 million dollars in small cap
growth stocks generally speaking she's told her clients that she won't take
less than a 2% position in anything because she wants to be able to focus on
a core group of stocks and really be on top of any big movements hoping to sell [Stocks in a sack land on a table]
the shares before well, any huge problems holding so in this case she's
found a company she loves an appropriately named coal company for [Woman looking through binoculars in her car]
spoiled investors called mine mine mine the only problem is that the stock is
thinly traded that is not a ton of shares trade every day and she needs to
own either ten million dollars worth of stock which would be a two percent
position or she doesn't want to own any the stock at the moment is trading at
ten dollars and seven cents a share and she wants it at ten bucks or better...
well at ten dollars and one penny she has no interest whatsoever in that stock [Stock graph for mine mine mine company]
at 10.00 she's a buyer so that is her limit order but on this all-or-none
order she waits and waits and waits knowing that sometimes all-or-none [Woman looking at laptop waiting for the stocks]
orders simply never get filled other times they get filled scarily too fast
like the seller knew something the buyer did not but along comes a bad market day
the White House says something stupid what are the odds? and the market tanks for
an hour and blam she is the proud new owner of a million shares of mine mine
mine good for her those shares are now all hers hers hers [Pigeon poops on mans head]
Up Next
What are At-the-Close Orders and At-the-Opening Orders? At-the-Close orders are given to brokers and the brokers can only fill them at the close of...
What are Buy Stop and Sell Stop Orders? An investor makes a buy stop order; the buy stop tells the broker to purchase an asset when its price becom...
What is a limit order, and how can we be sure we never have one of those in place when we go to a doughnut shop?