On Saxo's trading platforms we offer a number of different order types, including simple and advanced order types, in order to provide you with the ability to tailor your investments to your needs.
This article presents an overview of these different order types, as well as the different order durations offered, to provide clarity on how they function and how to use them.
Be aware that in volatile markets price and time of order execution might be affected. Read more in our Order execution policy
- What is an order?
- Simple orders
- Advanced orders
- Order duration
- Conditional orders
What is an order?
You place an order to give instructions to buy or sell assets (Stocks, currencies, futures, options, ETFs, and other assets). On our platforms, you can open a trade ticket from anywhere (Watchlist, Chart, Product overview, ...) and provide the conditions that need to be fulfilled for the order to be executed and become a position in your portfolio, but also to close an existing position.
A market order is the most basic type of buy and sell trade and will likely be what most people would associate with the stock market. A market order will execute the trade at the market price at the time the order is placed. This means that once the order has been placed, it will be filled at the current market price pending the market being open. If the order is placed when the market is closed, it will be filled at market price upon opening.
The price displayed when the order is placed may differ from the price at which it is filled due to a number of reasons including price delays or the illiquidity of an instrument for example. In order to access live prices, you must subscribe to an exchange that the desired instrument is listed on. For more information about live prices, see this article.
Do note however, all transactions are subject to the availability of the selected instrument and will depend on the size and timing of the order as well as the liquidity of the instrument.
A limit order is intended to provide more control over the price at which you buy or sell an instrument. When buying an instrument, with a limit order you set a maximum price at which the trade should be executed. Inversely, when selling an instrument, with a limit order you set a minimum price at which the trade should be executed.
A limit order is a useful tool when you are interested in buying or selling a stock (or other assets) at a certain price level. By placing a limit order you can then have more influence over which price level you buy or sell the stock in question.
For example, if you wish to purchase a stock that is currently trading at $100 but wish to enter the market at a lower price, you can set a limit order that triggers the order at your desired price, such as $95. In this case, if the price goes down to $95, the order will be triggered and the trade will be executed. If the price does not drop down to the desired level, the trade will ultimately not be filled. When placing the limit order, you will also be able to control how long the order will be open for (see Order duration).
A stop order is an order that will buy or sell an instrument at market price if the specified price is met. Stop orders can be used to both enter the market or to sell existing positions.
You can also utilize the stop order as a stop-loss order on an existing position to prevent additional losses in order to further protect your investment. The purpose of a stop-loss order is to limit a trader's loss on a security position. For instance, setting a stop-loss order at 5% below the price at which you bought the stock will limit your potential loss to 5%.
When using a stop-loss order, a market order to sell is triggered at the price you have chosen when placing the order. Please note that execution is not guaranteed.
Trailing stop order
A trailing stop order is a type of stop order that will change to follow the position if the price moves in your favour. So for example, if the price of the security continues to go up, the trailing stop order will follow the market price.
When placing a trailing stop order, you will set a price that will determine at which point the stop order will be triggered when the price begins to fall.
For more information see the following article.
Stop limit order
A stop limit order functions similarly to a regular stop order, but upon the stop price being met, it will convert to a limit order with a limit price chosen by you.
This type of order gives you some protection from a bad fill in a gapping or illiquid market.
OCO (One-cancels-the-other) order
The OCO (One-cancels-the-other) order can be used to place stop-loss and take-profit orders on a net position as well as to enter the market.
OCO orders that are not related to a position can be used to place stop-loss and take-profit orders on a net position, where one is cancelled if the other is executed (also known as "bracket orders").
ALGO (Algorithmic) orders
An algorithmic order is an order executed by an automated strategy according to specific parameters or conditions. Algorithmic orders are intended to minimize the market impact created from placing larger orders or achieving a recognized benchmark such as VWAP (Volume Weighted Average Price).
For more information on how to place an algorithmic order, please read the following article.
In addition to the different kinds of order types, there are also different options for how long these orders will stay open. The following presents an overview of these different order durations.
G.T.C. (Good 'til cancelled)
A good 'til cancelled order is an order that will remain open until it is either filled or until the investor/trader cancels it themselves. G.T.C orders can be useful to purchase securities at a certain price point but can also be vulnerable to volatility.
Day orders are orders which will remain open until the market closes on the day the order was placed. In the case of an order accepted during the weekend, the order will be open until the market closes on the first business day that follows.
G.T.D. (Good 'til date)
A Good 'til date order is an order for which the expiration will be on a pre-determined date. On Saxo's platforms, you have the option to set a G.T.D. trade for a period of one week, one month, end of week, end of month, end of year, or to set a specific date of your choosing.
Saxo also offers the ability to place conditions on any orders that you place. With Conditional Orders, you can specify a conditional event in one financial instrument. If the condition occurs this will trigger a separate order in the same or another financial instrument.
For more information about conditional orders and how to use them, please refer to this article.