Market order definition
Market order
A market order is an instruction by a trader or investor (usually to a broker) to immediately buy or sell an asset or security at the current price.
A market order is the most common type of transaction in financial markets. It is the default choice for most online broker transactions.
Market order vs limit order
A limit order instructs a broker to buy or sell only at a specific price. It’s the main alternative to a market order for most individual, retail traders and investors.
Limit orders offer added control by allowing traders and investors to set maximum acceptable buying prices or minimum acceptable selling prices when placing orders.
The limit order only gets executed if the asset reaches the price set. In contrast, the market order gets completed at the current market price.
Limit orders also get used by professional traders and day traders aiming for profits by buying and selling quickly to exploit slight changes in prices.