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.

BREAKING DOWN '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.