Below The Market

DEFINITION of 'Below The Market'

An order to buy or sell a security at a price that is lower than the current market price. For example, a trader can place a limit order to buy a stock at a specified price that is below the current price. The order would only be filled if the specified price or better was available. While order execution is not guaranteed, placing an order in this manner, below the market, helps ensure that the desired price, or better, is achieved.


Can also be a price or rate that is lower than the current prevailing conditions in an open market. Goods or services that are offered at a lower price than the "going," or typical, rate can be said to be below the market.

BREAKING DOWN 'Below The Market'

Traders and investors who want to try to achieve a better price or position may enter an order to buy below the market. A limit order to buy allows traders to specify the price at which they are willing to purchase a security; if the limit order to buy is filled, the order will be filled at the specified price or better. A below market order to sell allows traders to quickly unload a position.


Real estate properties are sometimes sold at below the market values, meaning they are offered at lower prices than comparable properties. Such properties are called BMV, below market value. Properties may be sold below their market value when the owners are faced with some type of financial difficulty such as bankruptcy, divorce, probate or if they must relocate quickly.

RELATED TERMS
  1. Buy Limit Order

    An order to purchase a security at or below a specified price. ...
  2. Limit Order

    An order placed with a brokerage to buy or sell a set number ...
  3. Away From The Market

    An expression that is used when the bid on a limit order is lower ...
  4. Bracketed Buy Order

    A buy order that is accompanied by a sell limit order above the ...
  5. Above The Market

    An order to buy or sell at a price set higher than the current ...
  6. Box-Top Order

    A buy or sell order made at the best market price. If the order ...
Related Articles
  1. Professionals

    Order Types

    NASAA Series 65: Section 17 Order Types. In this section market order, limit order, stop order and stop limit order.
  2. Forex Education

    Intermediate Guide To MetaTrader 4 - Order Types

    Traders have the option of placing different order types using the MT4 platform. Market OrderA market order is the most basic type of trade order and is used to buy or sell a security at the ...
  3. Investing

    How To Start Trading: Order Types

    The types of orders you use can have a large effect on your trading performance, so understanding the different order types is important to your success.
  4. Professionals

    Transacting Securities

    FINRA Series 6 Exam Study Guide - Transacting Securities. In this section: Long and Short Sales and Types of Orders with different characteristics and costs.
  5. Professionals

    Types of Securities Orders

    Securities Orders
  6. Professionals

    Orders

    Orders
  7. Forex

    Entering A Trade

    The importance of executing the correct orders
  8. Brokers

    Explaining Market Orders

    A market order is the most common order used to purchase a financial security.
  9. Active Trading Fundamentals

    The Basics Of Trading A Stock

    Taking control of your portfolio means knowing what orders to use when buying or selling stocks.
  10. Professionals

    Types Of Orders

    Investors can enter various types of orders to buy or sell options. Some orders guarantee that the investor’s order will be executed immediately. Other types of orders may state a specific ...
RELATED FAQS
  1. What are the advantages of a limit order over a market order?

    Understand the functional differences between a limit order and a market order and the respective advantages and disadvantages ... Read Answer >>
  2. What is the difference between a buy limit and a sell stop order?

    Understand the differences between the two order types, a buy limit order and a sell stop order, and the purposes each one ... Read Answer >>
  3. How do I place a limit order online?

    Learn how a limit order is placed, the types of stocks it is most useful for and the specifications placed with it to suit ... Read Answer >>
  4. When is a buy limit order executed?

    Understand how buy limit orders work, and factors such as the bid-ask spread and market volatility that traders must consider ... Read Answer >>
  5. How can I use a buy limit order to buy a stock?

    Learn how a buy limit order is used by an investor who wants to buy a stock at a certain price, and understand how limit ... Read Answer >>
  6. Why do limit orders cost more than market orders?

    Learn the difference between a market order and a limit order, and why a trader placing a limit order pays higher fees than ... Read Answer >>
Hot Definitions
  1. Cost Of Debt

    The effective rate that a company pays on its current debt. This can be measured in either before- or after-tax returns; ...
  2. Yield Curve

    A line that plots the interest rates, at a set point in time, of bonds having equal credit quality, but differing maturity ...
  3. Stop-Limit Order

    An order placed with a broker that combines the features of stop order with those of a limit order. A stop-limit order will ...
  4. Keynesian Economics

    An economic theory of total spending in the economy and its effects on output and inflation. Keynesian economics was developed ...
  5. Society for Worldwide Interbank Financial Telecommunications ...

    A member-owned cooperative that provides safe and secure financial transactions for its members. Established in 1973, the ...
  6. Generally Accepted Accounting Principles - GAAP

    The common set of accounting principles, standards and procedures that companies use to compile their financial statements. ...
Trading Center