Market-On-Open Order (MOO)

DEFINITION of 'Market-On-Open Order (MOO)'

An order to buy or sell shares that specifically requests execution at the opening price. Market-On-Open (MOO) orders can only be executed when the market opens, and at no other time during the trading day. MOO orders on the Nasdaq can be entered, canceled or amended from the time the system opens at 7 a.m. to 9:28 a.m. EST. The MOO order does not specify a limit price, unlike a Limit-On-Open (LOO) order that specifies one.

BREAKING DOWN 'Market-On-Open Order (MOO)'


Traders and investors use MOO orders when they believe market conditions warrant buying or selling shares at the open. For example, during earnings season – the time period when companies report their quarterly results – most companies report results after markets close. Significant action typically follows on the next trading day. Companies that exceed expectations generally see their stocks rise in price the next day, while companies that miss estimates see their stocks decline.

Assume you hold 1,000 shares in Intel, which has just reported that sales and earnings for the next quarter will be below analysts’ estimates. The stock trades lower in the after-hours market, and you think it will continue to decline sharply tomorrow. You would therefore enter a MOO order since you think the stock will open tomorrow at a lower price but close even lower.
 
The risk is that you would receive the opening price on Intel whether it’s down 5%, 10% or 20%. On the other hand, if you think the stock does not warrant a 10% decline and would rather hold it than take such a loss, you could enter a LOO order, which specifies the price at which you are willing to sell your Intel shares. This would guarantee that your Intel shares will be sold only at a certain price upon market open, and not below your limit price.
 

RELATED TERMS
  1. Limit-On-Open Order - LOO

    A type of limit order to buy or sell shares at the market open ...
  2. Limit Order

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

    An order to buy or sell a security at a price that is lower than ...
  4. Buy Limit Order

    An order to purchase a security at or below a specified price. ...
  5. Bracketed Buy Order

    A buy order that is accompanied by a sell limit order above the ...
  6. Open Order

    An order to buy or sell a security that remains in effect until ...
Related Articles
  1. Investing

    The Opening Cross: How Nasdaq Stock Prices Are Set

    The National Association of Securities Dealers Automated Quotations, commonly referred to as Nasdaq, is a computerized marketplace where stocks are traded from 9:30am to 4pm Eastern Standard ...
  2. Trading

    The Basics Of Trading A Stock

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

    Making The Trade: Understand Order Types

    Buying and selling stock can be a lot like buying or selling a car. Traders should use and understand tools such as market orders, limit orders, day orders, and good-'til-canceled orders to ensure ...
  4. Trading

    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.
  5. Trading

    How To Place Orders With A Forex Broker

    Learn how to set each type of stop and limit when trading currencies.
  6. Markets

    Understanding Order Execution

    Find out the various ways in which a broker can fill an order, which can affect costs.
  7. Investing

    The Auction Method: How NYSE Stock Prices are Set

    The New York Stock Exchange (NYSE), sometimes referred to as “the big board,” is the oldest and largest stock exchange in the United States. NYSE is the place investors think of when ...
  8. Trading

    Which Order To Use? Stop-Loss Or Stop-Limit Orders

    Stop-loss and stop-limit orders can provide different types of protection for investors seeking to lock in profits or limit losses. Investors need to know how each type of order works to know ...
  9. Markets

    Is This Intel's Breakthrough Quarter? (INTC)

    Combined with various product cycle refreshes in both the datacenter and the PC client segments, Intel could be setting up for an upside surprise.
  10. Markets

    Explaining Market Orders

    A market order is the most common order used to purchase a financial security.
RELATED FAQS
  1. What is the difference between a stop and a market order?

    Learn about market orders and stop orders, how they are used and executed, and the main difference between stop orders and ... Read Answer >>
  2. 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 >>
  3. What's the difference between a market order and a limit order?

    Buy and sell trades with market orders at the present stock price and execute limit orders if the stock price falls within ... Read Answer >>
  4. What's the difference between a stop and a limit order?

    Different types of orders allow you to be more specific about how you'd like your broker to fulfill your trades. When you ... Read Answer >>
  5. 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 >>
  6. How do I place an order to buy or sell shares?

    Read a brief overview of how to open a brokerage account, how to buy and sell stock, and the different kinds of trade orders ... Read Answer >>
Hot Definitions
  1. Duration

    A measure of the sensitivity of the price (the value of principal) of a fixed-income investment to a change in interest rates. ...
  2. Dove

    An economic policy advisor who promotes monetary policies that involve the maintenance of low interest rates, believing that ...
  3. Cyclical Stock

    An equity security whose price is affected by ups and downs in the overall economy. Cyclical stocks typically relate to companies ...
  4. Front Running

    The unethical practice of a broker trading an equity based on information from the analyst department before his or her clients ...
  5. After-Hours Trading - AHT

    Trading after regular trading hours on the major exchanges. The increasing popularity of electronic communication networks ...
  6. Omnibus Account

    An account between two futures merchants (brokers). It involves the transaction of individual accounts which are combined ...
Trading Center