Opening Imbalance Only Order (OIO)

Definition of 'Opening Imbalance Only Order (OIO) '


Limit orders that provide liquidity during the opening cross on the Nasdaq. Opening Imbalance Only (OIO) orders are only executable on the opening cross and are not displayed or disseminated. OIO buy orders only execute at or below the 9:30am bid price, while OIO sell orders only execute at or above the 9:30am offer price. OIO orders must necessarily be limit orders; market OIO orders are not permitted. Since OIO orders are only executable during the opening cross, they are not at risk of being executed prior to market open, unlike continuous market orders.

Investopedia explains 'Opening Imbalance Only Order (OIO) '




OIO buy or sell orders that are priced more aggressively than the 9:30am Nasdaq highest bid or lowest offer prior to market open will be re-priced to the Nasdaq bid or offer before the opening cross is executed.

So, for example, if an OIO buy order price is $9.95 and the Nasdaq bid is at $9.93, the OIO order will be re-priced to $9.93. This adds liquidity to the market and helps ensure that Market-On-Open (MOO) and Limit-On-Open (LOO) orders are executed.
 
OIO orders are accepted on the Nasdaq from 7am onward. However, market participants cannot update these orders after 9:28am, although new OIO orders can still be entered after that time.



Filed Under: ,

comments powered by Disqus
Hot Definitions
  1. Amplitude

    The difference in price from the midpoint of a trough to the midpoint of a peak of a security. Amplitude is positive when calculating a bullish retracement (when calculating from trough to peak) and negative when calculating a bearish retracement (when calculating from peak to trough).
  2. Ascending Triangle

    A bullish chart pattern used in technical analysis that is easily recognizable by the distinct shape created by two trendlines. In an ascending triangle, one trendline is drawn horizontally at a level that has historically prevented the price from heading higher, while the second trendline connects a series of increasing troughs.
  3. National Best Bid and Offer - NBBO

    A term applying to the SEC requirement that brokers must guarantee customers the best available ask price when they buy securities and the best available bid price when they sell securities.
  4. Maintenance Margin

    The minimum amount of equity that must be maintained in a margin account. In the context of the NYSE and FINRA, after an investor has bought securities on margin, the minimum required level of margin is 25% of the total market value of the securities in the margin account.
  5. Leased Bank Guarantee

    A bank guarantee that is leased to a third party for a specific fee. The issuing bank will conduct due diligence on the creditworthiness of the customer looking to secure a bank guarantee, then lease a guarantee to that customer for a set amount of money and over a set period of time, typically less than two years.
  6. Degree Of Financial Leverage - DFL

    A ratio that measures the sensitivity of a company’s earnings per share (EPS) to fluctuations in its operating income, as a result of changes in its capital structure. Degree of Financial Leverage (DFL) measures the percentage change in EPS for a unit change in earnings before interest and taxes (EBIT).
Trading Center