Placing your first trade can be a very daunting process. many doubts can come into your mind when placing a trade, and some don’t know what all the different order types mean. We are going to fill that gap and get you more confident in your order process.
This is TD’s Order entry screen for their Advanced Dashboard, here you can manually input the ticker symbol in this case its #BTE. Below that you have the “BUY” and “SELL” action depending on if you want to buy or sell your position, Next you have the order quantity and price type. With the price type you have a few different options.
- Market -Market buy or sell order will guarantee a fill but not the price
- Limit – Limit order will guarantee the predetermined price but not guarantee a fill
- Stop Limit – Stop limit order will be executed at a predetermined price if the stock drops to your “stop-out” point
- Stop Market – is an order to buy or sell a stock once the price of the stock reaches a specified price, known as the stop price. When the stop price is reached, a stop order becomes a market order
- Trailing Stop Market – A sell trailing stop order sets the stop price at a fixed amount below the market price with an attached “trailing” amount.
- Trailing Stop Limit – A trailing stop limit moves with the market price, and continually recalculates the stop trigger price at a fixed amount below the market price, based on the user-defined “trailing” amount
Next you have the limit price where you can set the exact price you wish to buy or sell the stock at. The duration can be set to the day or you can extend the open order for any duration until the order is fill or changed.
Once you have set the parameters, Action – Buy/ Sell, Quantity, Price type, Price Limit and Duration, you’re now ready to preview the order.
Previewing the order is essential to confirm no mistakes have been made, with the volatility and face paced environment the markets trade in it’s very easy to over look a decimal point or an extra zero. Once you have confirmed your order is correct you’re now ready to place the order!
