It helps to know some of the key terminology when it comes to placing Spread betting orders and here at Made to Trade we aim to help. This post will help you explain them to you, so you will be able to tell VWAPs from your MOOs and OCOs.
Market Order– A market order is an order to fulfill an order to buy or sell at the current market price- e.g Buy Big Bank PLC @ 1p per point at 100p would be a market order.
Limit Order– A limit order is an order to sell or buy at a limit price. This limit price is normally to buy or sell above the current market price- e.g Buy Big Bank PLC @ 1p per point at 102p would be a limit order, if Big Bank PLC was currently trading at 100p.
Stop Loss Order– A stop loss order is an order aimed to stop losses at a certain level. With a long client it will be when the market falls to a certain level and with a short client when a market climbs to a certain level. Stop Loss orders are used with an open position in order to provide protection against the market moving against there position. e.g a client placing a Buy order for Big Bank PLC @1p per point @100p, might chose to place a stop order at 94p to limit his loss.
Stop To Open Order– A stop to open order is an order to open a position at certain level, either if the market is falling or rising. These orders are designed to open a position if the market moves in a certain direction, often used by momentum traders who believe to get into a position if the market shows particular significant momentum.-e.g client placing a Sell Order for Big Bank PLC @1p per point @95p, if share was trading at 100p this would be a significant movement.
GFD-(Good for the Day) the order is Good For the rest of the trading Day in question.
MOC-(Market on Close) order will be completed at market price at the close of the market.
MOO-(Market on Open) opposite as the order will be completed at market price at the opening of the market.
OCO-(One Cancels the Other) their are two order are two be executed but one cancels the other order.
GTC– (Good Until Cancelled) an ongoing order (different from an Ongoing trade), the order will remain good until it is cancelled by the client.
Fill or Kill– for a particular large order a broker is instructed by the client to get a price for the whole quantity of the order, if he is unable to get a price then the order is killed and cancelled.
VWAP-(Volume Weighted Average Price) an order which is to be fulfilled throughout the day to get the average price of that particular day.
