Types of Orders: Different Order Types in Stock Market

With the spread of financial literacy, technology and the internet, the appetite of Indians to invest in the stock market is growing rapidly. And to keep up with the changing market trends and consumer needs Angel One has made diligent efforts to make trading accessible to everyone. 

But before we dive into buying and selling stocks, it’s important to understand the different types of orders so that you can choose the right one based on your investment objective.

What is an Order?

An order is an instruction given by an investor to a broker to buy or sell the securities on a trading platform on his behalf.

Similarly, when you place a trade order on Angel One platform you will find the below mentioned orders on your screen. So, let’s understand what these different orders mean in the trading ecosystem. 

Market Order

A Market order is an order to buy or sell a security at the prevailing market price. This type of order is executed on the basis of the next available best price.

Limit Order

In a Limit order, you set the price at which you want to buy or sell a security- known as limit price.

 In case of Limit order:

  •  – The order gets executed only at the limit price or a lower price for Buy Limit orders
  •  – The order gets executed only at the limit price or a higher price for Sell Limit orders.

Now let’s take a look at some special order Types. 

Stop-loss Order

A Stop-loss order helps you limit your losses by exiting a trade, if a specified trigger price(the specific price at which your buy/sell order becomes active for execution) is reached. 

Stop-loss Market order

In this case, once the trigger price is reached, the Stop loss order gets converted into a Market order

Stop-loss Limit order

In this case, once the trigger price is reached, the Stop loss order gets converted into a Limit order

Trailing Stop loss order

A Trailing Stop-loss is an order that lets you set a maximum value or percentage of loss you can incur on a trade. If the security price rises or falls in your favor, the trigger price jumps with it at the set value or percentage. If the security price rises or falls against you, the trigger price stays in place.

Robo Order

A Robo order is a multi-leg order used in intraday trading which allows you to place 2 more orders along with the initial order. This order type can be used to book profits at specified target prices as well as to minimise losses at a trigger price. Robo orders can be used for both buy and sell orders.

Case 1: If the initial order is a Buy order, then both the target and Stop loss orders will be Sell orders. 

Case 2: If the initial order is a Sell order, the other two orders will be a Buy orders.

Placing a Robo order, investors can save time, book profits as well as minimise losses.

For instance, you want to buy shares of the Company XYZ at ₹.1,000 and want to book profit at ₹.1,050. However, you fear that the price might drop drastically if it falls below ₹.990. So, to counter this you place a Robo order with:

  • – An initial Buy order at a limit price of ₹ 1,000
  • – A Sell order with target price at ₹.1050
  • – A Stop-loss Sell order with trigger price at ₹ 990.

Once the Limit order is filled and any of the 2 following orders is triggered and executed, the remaining order will automatically get canceled.

In the above case, if the Limit order at ₹ 1,000 is executed and the market moves in favor of the investor and hits the target price of ₹ 1,050, the Target order is triggered and executed, the Stop loss order will be automatically canceled.

The Robo order also comes with a unique feature where the client can trail his losses to minimise his losses and generate the best returns out of every trade. Suppose in the above order if the client places a Trailing Stop Loss order of ₹1; whenever the stock price of XYZ goes up by ₹ 1, the stop loss also goes up by ₹1. However, the stop loss remains unchanged if the price goes down.

You can place any of the above orders under the following product types provided by Angel One.

Delivery (Also known as Cash & Carry or CNC)

Delivery orders refer to when you buy, take delivery of the securities and hold them in your account. After delivery, you can hold the securities for as long as you want, and choose to sell them whenever you want.

Margin

With Margin, you can use leverage to place your trade and buy stocks by paying just a fraction of the total trade value.

Margin Product allows you to place your order with a minimum required margin and the rest will be funded by Angel One, similar to a short term loan facility 

With Margin order, securities can be purchased in delivery only.

Angel One allows you to increase your Buying Power by 4x limit 

So if your Ledger Balance is ₹ 25,000, you can invest in securities up to ₹ 1,25,000 using Margin order with ₹ 1,00,000 funding from Angel One

Intraday

Intraday orders refer to buying and selling of securities on the same day before the market closes. 

In case you do not close an intraday open position, they are automatically squared off before the close of the market as per the schedule below:

Segment  Square off time
Capital and Derivative Segments of Equity market Between 3:15 PM and closure of the market
Commodity Segments
  • Between 11:15 PM and market closure when the market closes at 11:30 PM
  • Between 11:30 PM and market closure when the market closes at 11:55 PM
Currency and Agro Commodities Between 4:45 PM and closure of the market

With Angel One, you can obtain the following validities (time frame during which the order remains valid in the market) for your order. 

Immediate or Cancel (IOC) order

An Immediate-Or-Cancel (IOC) order gets executed immediately. You can place a buy or sell IOC order. However, any portion of the order that cannot be fulfilled immediately gets canceled.

Eg: You place an IOC order to purchase 100 shares of the Company XYZ. Since its an IOC order:

  • – The order gets placed immediately 
  • – However, if there is a matching order only for 10 shares and those 10 shares are purchased, the order for the remaining 90 shares gets canceled

Day order

A Day order can get executed anytime within the market hours of the same day once there is a matching order. 

Eg: You place a Day order to purchase 100 shares of Company XYZ at ₹ 10 per share. Since it’s a Day order, the order can get filled anytime during the market hours of the same trading day once it finds a matching order.

Good Till Triggered (GTT) order

GTT order stands for Good Till Trigger order. GTT order allows you to  buy or sell orders at a predetermined limit price. These orders are executed if the market price of the stock reaches your specified price also known as Trigger Price before the GTT order expires. 

A GTT order is a limit order where the product type can be delivery or margin. You cannot place GTT orders in the intraday product type. You can also place GTT orders in the derivatives segment. In this case the GTT order will be executed as a carry forward type order and order expiry will be as per contract expiry date. 

To know more about GTT order click here

If your busy schedule doesn’t allow you to place a trade during market hours, Angel One provides you a special order type called After Market Order (AMO).

After Market Order (AMO)

As the name suggests, AMO allows you to place an order during non-market hours i.e, either before or after the market hours. This order will be triggered in the next trading session. AMO orders are helpful to place an order at a certain price before the start of market hours.

Now that you know about the various kinds of orders and product types Angel One offers, we hope you will be able to identify which order suits your investment needs and benefits you the most.