Order Types in Trading: Market, Limit, Stop and Time in Force

An order type is the instruction that tells your broker how to trade: at any price right now, only at a price you set, or only once the market reaches a trigger. The three basic types are the market order, the limit order and the stop order, and the stop-limit order combines the last two. A second instruction, the time in force, says how long the order stays live. This page gives the SEC's investor definitions, where each order sits relative to the price, a real gap that shows what a stop and a stop-limit actually did, and the closing auction deadlines from the exchanges' own documents.

The main order types in trading

The definitions below quote Investor.gov, the SEC's site for individual investors.

• Market order. "An order to buy or sell a security immediately. This type of order guarantees that the order will be executed, but does not guarantee the execution price." A market buy generally fills at or near the ask, a market sell at or near the bid.
• Limit order. "An order to buy or sell a security at a specific price or better." A buy limit fills only at the limit or lower, a sell limit only at the limit or higher, and the order may never fill.
• Stop order. Also called a stop-loss order, it is an order to buy or sell "once the price of the stock reaches the specified price, known as the stop price. When the stop price is reached, a stop order becomes a market order." The SEC's bulletin on stop orders adds that the stop price "is not the guaranteed execution price."
• Stop-limit order. When the stop price is reached, the order becomes a limit order, so it controls the price but "may not be executed if the stock's price moves away from the specified limit price."
• Trailing stop. A stop whose stop price follows the market by a fixed amount or percentage; it is covered on trailing stop.

Some brokers trigger stops on the last sale price and others on quotes, the bulletin notes, so the same stop can trigger at different moments at two brokers. Linked orders, where one order sends another once it fills, are covered on OTO order, and orders that hide part of their size on iceberg order.

Sell stop vs sell limit, buy stop vs buy limit

The four resting orders differ by side and by where they sit relative to the current price. A limit order waits for a better price than now; a stop order waits for a worse one and then trades at market.

One mix-up to avoid is placing a sell limit below the price to protect a long: a sell limit below the market is marketable and sells at once. Protection below the price is a sell stop or a sell stop-limit. More on placing protective stops is on stop loss order.

What a stop did on a real gap

Gaps show what a stop does and does not do, because the next trade can be far from the stop price. The S&P 500 ETF closed at 536.70 on Thursday, April 3, 2025 (unadjusted daily prices from our data). Take a holder with a sell stop at 530 and, in a second account, a sell stop-limit with a stop at 530 and a limit at 528, both good until canceled. The next sessions:

The stop did its job of getting out, at a worse price than its stop; the stop-limit did not protect anything for three sessions and only sold because the price came back. Had the price kept falling, it would still be open. Daily bars do not show the exact fill of a market order at the open, which depends on the opening auction and the broker, so treat 523.67 as an approximation.

Time in force: day, GTC, IOC and fill or kill

The time in force says how long an order stays live. Investor.gov's glossary defines the main ones:

• Day order. Unless you specify otherwise, orders are "good only during that trading day"; day orders that do not execute during regular hours expire and do not carry into after-hours trading.
• Good-til-canceled (GTC). Lasts "until the order is completed or canceled"; brokers typically cap how long it can stay open, and the limit varies by broker. On Nasdaq's own system, a GTC order stays live until canceled or until it is 365 days old.
• Immediate or cancel (IOC). Must execute immediately; any part that cannot be filled at once is canceled.
• Fill or kill (FOK). Must execute immediately in its entirety, or the whole order is canceled; no partial fill.
• All or none (AON). Must execute in full or not at all, but can stay active until it executes or is canceled.

Nasdaq's order type guide also lists time in force values tied to sessions, such as market hours (9:30 a.m. to 4:00 p.m. Eastern) and system hours (4:00 a.m. to 8:00 p.m.), and an expire time set by the trader. An order can fill in pieces at different prices unless it is FOK or AON; see partially filled.

Market on close and limit on close orders

A market on close (MOC) order buys or sells in the closing auction at the official closing price; a limit on close (LOC) order does the same with a price limit. Their deadlines are set by each exchange:

• Nasdaq (Closing Cross FAQ): MOC orders must be received before 3:55 p.m. Eastern and LOC orders before 3:58 p.m., but an LOC order entered after 3:55 p.m. is re-priced if its limit is more aggressive than the 3:50 or 3:55 p.m. reference price; orders can be modified or canceled only before 3:50 p.m.
• NYSE (auctions fact sheet): MOC and LOC orders can be entered, modified or canceled until 3:50 p.m.; after 3:50 p.m., new ones are accepted only on the side that offsets a published imbalance, and none can be modified or canceled.

MOC orders suit anyone who needs the closing price; the trade-off is the same as for any market order: certainty of execution, not of price. Closing imbalances are explained on trading imbalance.

Entering an order

An order ticket asks for the same few fields whatever the platform: the symbol, buy or sell (and, for a short, sell short), the quantity, the order type, the limit or stop price where needed, and the time in force. Before sending, check three things: that the side is right (a sell limit below the price fills at once), that the price is on the right side of the market for the type, and that the time in force matches the plan, since a day stop disappears at the close. The bid and ask and the depth of market show what a market order would pay before you send it.

More definitions are in trading concepts.