Types of Orders: Market, Limit & More

Lesson Content

Welcome to the world of stock orders! When you trade in the Indian stock market, you need to understand how to place orders correctly. There are different types of orders that help you buy or sell shares according to your strategy. The most common orders are Market Orders and Limit Orders. A Market Order is executed immediately at the best available price in the market. For example, if you place a market order to buy Reliance Industries shares, it will be bought at the current market price, which could be around ₹2,500 per share. This is good for quick execution but you might get a slightly different price than expected. A Limit Order, on the other hand, lets you set a specific price at which you want to buy or sell. For instance, if you want to buy TCS shares at ₹3,200 or lower, you can place a limit order at ₹3,200. The order will only execute if the market price reaches that level or better. There are also other types like Stop Loss Orders, which help limit your losses. If you own Infosys shares at ₹1,500 and want to sell if the price drops to ₹1,400, you can place a stop loss order. If the price reaches ₹1,400, it becomes a market order and sells immediately. Understanding these order types is crucial for managing your risk and executing trades effectively in the Indian stock market.