Understanding Order Types: Market, Limit, Stop-Loss & More
When you trade in the stock market, placing the right type of order is just as important as picking the right stock. Understanding order types helps you control how and when your trades are executed — and can protect you from unnecessary losses. Let's break it down in simple terms.
Market Order
A Market Order is when you want to buy or sell immediately at the best available price.
Limit Order
A Limit Order lets you set the exact price at which you want to buy or sell. The trade will only happen if the market reaches your set price.
Stop-Loss Order
A Stop-Loss Order is designed to protect you from big losses. You set a trigger price, and if the stock hits that price, your position is closed automatically.
Stop-Limit Order
This combines a stop-loss and limit order. Once the stop price is reached, a limit order is placed instead of a market order.
Trailing Stop Order
A Trailing Stop moves automatically with the stock price to protect profits.
Key Takeaways
- Market Order → Fast execution, no price guarantee
- Limit Order → Price control, but no execution guarantee
- Stop-Loss Order → Protects you from large losses
- Trailing Stop → Protects profits while allowing growth
Learn to Trade Like a Pro
Mastering order types — like Market, Limit, Stop-Loss, and Trailing Stop — is just the beginning of becoming a successful trader. At Traders Training Academy, we teach you how to use these order types effectively.
