Market order in essence

A market order is the cornerstone of trading. It is the simplest type of order given by a trader to a broker to buy/sell an asset at the best available price under current market conditions.

If it is issued to buy an asset, the order is executed immediately provided that there are sell orders to match the worth of the assets that a trader wants to buy.

A sell order is also fulfilled instantly on the condition that the number of shares requested to sell can make up for buy orders.

Importantly, even though this type of order is used to buy or sell on the spot, it cannot guarantee a particular price.

The keyword to define the market order is speed. Investors who give this type of order to a broker want to complete a trade as quick as a flash.

Bear in mind these ideas when working with market orders.

- It is better to use a market order to manage trades with highly liquid assets such as large-cap stocks, futures, or top exchange-traded funds (ETFs).

- Consider other types of orders, for example, a limit order, dealing with thin-traded securities and assets which are marked by a wide difference between ask and bid prices. With a limit order, you can execute a trade at the best price.

A market order is a basic transaction setting with almost all online brokers. This order enables a one-click execution of transactions. Most frequently, market orders are applied to manage intraday trades. It means that a trade is executed until the end of a trading day, though these are rare cases when a market order is not completed instantaneously.