METATrading Academy

Share market basics

Market orderjo bhi bhav mile, turant sauda

An order to buy or sell immediately at the best available price in the order book, prioritising speed of execution over price.

A market order executes right away at whatever price the order book offers. A market buy takes the lowest ask, a market sell hits the highest bid, and if your quantity is larger than what sits at the best price, the rest fills at the next prices down the book. In a liquid stock like SBI, that means paying a few paise more than the last traded price. In an illiquid stock or a far out-of-the-money option, a market order can fill several percent away from the LTP, an unpleasant surprise called slippage. Market orders make sense when getting out matters more than the exact price, for example when a stop loss must trigger. For entries, especially in thin instruments, a limit order protects you. Some brokers block market orders in illiquid options for this reason.

Lessons that use this term

Video
Basics7 min read

Investing vs trading: the two halves of the share market

The share market runs on two activities that look alike and are nothing alike. Investing is owning a business for years. Trading is profiting from price moves over hours or weeks. Mixing them up is behind most early losses.