Opening Imbalance Only Order (OIO)

AAA

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.
RELATED TERMS
  1. Limit Order

    An order placed with a brokerage to buy or sell a set number ...
  2. Opening Cross

    A method used by the Nasdaq to determine the opening price for ...
  3. Confidential Treatment Order - ...

    An order that provides confidential treatment for certain documents ...
  4. Minimum Guaranteed Fill Order- ...

    A service provided by market makers in its assigned stocks to ...
  5. End Of Day Order

    A buy or sell order that specifies a price for the security, ...
  6. Off-Floor Order

    An investor's directive to buy or sell securities when that directive ...
RELATED FAQS
  1. Why can't I enter two sell orders on the same stock?

    To answer this question, let's look at a few different situations. You bought a stock for $10 but want to be able to protect ... Read Full Answer >>
  2. I placed a limit order to buy a stock after the market closed, but the stock's price ...

    The scenario you describe is very common and can be frustrating for any type of investor. Many traders will identify a potentially ... Read Full Answer >>
  3. 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 Full Answer >>
  4. Can you place a stop-loss order on a mutual fund?

    First, remember that a stop-loss order is a limit order placed with a broker to sell a stock when it reaches a certain price. ... Read Full Answer >>
  5. At what point in the ordering process does a broker charge commission?

    When placing a market order for a security through a broker, there will be a commission accompanying the service. The fee ... Read Full Answer >>
  6. Why does my broker allow me to enter only day orders for short selling?

    Put simply, brokerage firms restrict short sales to day orders because of the complexity of the short sale transaction and ... Read Full Answer >>
Related Articles
  1. Investing Basics

    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. Investing Basics

    Understanding Order Execution

    Find out the various ways in which a broker can fill an order, which can affect costs.
  3. Forex Education

    How To Place Orders With A Forex Broker

    Learn how to set each type of stop and limit when trading currencies.
  4. Active Trading Fundamentals

    The Stop-Loss Order - Make Sure You Use It

    It's a simple but powerful tool to help you implement your stock-investment strategy. Find out how.
  5. Investing Basics

    Explaining Buy Limit Orders

    A buy limit order allows traders and investors to specify the price that they are willing to pay for a security, such as a stock.
  6. Investing

    How Nasdaq Makes Money

    NASDAQ provides a marketplace which offers money-making opportunities to investors. Investopedia explains how NASDAQ makes money.
  7. Investing

    Why Is The Nasdaq 5,000 Different This Time?

    The Nasdaq this week has slipped below the 5,000 high-water mark it reached last week. The last time it hit above 5,000 was in March 2000.
  8. Trading Strategies

    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 ...
  9. Options & Futures

    Options -- Accessing Stakes In Apple At Less Cost

    Finding Apple stock costly to trade? Here are multiple ways to trade it through low-cost Apple options.
  10. Investing Basics

    What is the Stock Market?

    A stock market is where shares in corporations are issued and traded. Stock markets are key components of a free market economy.

You May Also Like

Hot Definitions
  1. Moving Average - MA

    A widely used indicator in technical analysis that helps smooth out price action by filtering out the “noise” from random ...
  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. Productivity

    An economic measure of output per unit of input. Inputs include labor and capital, while output is typically measured in ...
  4. Variance

    The spread between numbers in a data set, measuring Variance is calculated by taking the differences between each number ...
  5. Terminal Value - TV

    The value of a bond at maturity, or of an asset at a specified, future valuation date, taking into account factors such as ...
  6. Rule Of 70

    A way to estimate the number of years it takes for a certain variable to double. The rule of 70 states that in order to estimate ...
Trading Center