Series 65 Exam Course

They will help you reduce bad fills and avoid lost points or price skids. But to use price orders to your advantage, you must be familiar with the various types of orders and when they are best used. You must also know what orders to avoid and when to avoid them. What You Should Know about Market Orders Market orders must be avoided whenever possible.

A market order is, as far as I'm concerned, a license to steal. Rarely will a market order be filled at the exact price you are expecting. Typically, a market order will cost you one tick, at times two or three.

In S&P futures, a market order may cost you much more than just a few ticks, although one or two ticks in a quiet market is not unusual. If you lose two ticks on entry and two ticks on exit, the cost per trade will most assuredly add up. However, not using market orders will cause you to risk not getting a position at all or not being able to exit a position at all.

Here are some guidelines for using market orders: Only use a market order when absolutely necessary. If you are using an intraday oscillator type signal which enters at the end of a given time segment, then a market order is acceptable.

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