Open Order

AAA

DEFINITION of 'Open Order'

An order to buy or sell a security that remains in effect until it is either canceled by the customer, until it is executed or until it expires. Open orders commonly occur when investors place restrictions on their buy and sell transactions. A lack of liquidity in the market or for a particular security can also cause an order to remain open.

INVESTOPEDIA EXPLAINS 'Open Order'

Market orders, which cannot have restrictions, are typically filled instantaneously, but if they remain open at the end of the day, the brokerage may cancel them. With limit orders, investors typically have to wait for the price that they set as their limit to be reached before the order can be executed. These orders will remain open either for the duration determined by the customer or until they are filled. If they remain open after several months, they may expire under the terms established by the brokerage through which the order is placed.

RELATED TERMS
  1. Limit Order

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

    1. An unexecuted order that is still valid. An open order is ...
  3. Order

    An investor's instructions to a broker or brokerage firm to purchase ...
  4. Buy

    1. A recommendation to purchase a specific security. A buy rating ...
  5. Opening Bell

    A bell that is rung to signify the start of the day's trading ...
  6. Market Order

    An order that an investor makes through a broker or brokerage ...
RELATED FAQS
  1. Are stop orders only used for stocks?

    Stop orders can be used for a variety of securities and are not limited to stocks. They can be extended to other securities, ... Read Full Answer >>
  2. Should I enter a limit order to buy a position with a bid and ask that are far apart?

    You face the risk of losing the spread in a security with a bid and ask that are far apart when you enter a market order. ... Read Full Answer >>
  3. When should I use a trailing stop order?

    Trailing stop orders are used to limit losses and protect profits on a stock position. You should use trailing stop orders ... Read Full Answer >>
  4. How can I use a stop order to limit my losses on a long stock position?

    A stop order is a useful order type when you are trying to limit losses on your long stock position. When you are long a ... Read Full Answer >>
  5. What is the difference between a stop and a market order?

    A stop order and a market order are different order types that dictate how to enter and execute trades. Traders and investors ... Read Full Answer >>
  6. How can I use a buy limit order to buy a stock?

    An investor uses a buy limit order to buy a stock at a specific price or better price. Unlike a market order that takes the ... Read Full Answer >>
Related Articles
  1. Investing Basics

    Understanding Order Execution

    Find out the various ways in which a broker can fill an order, which can affect costs.
  2. 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.
  3. Options & Futures

    Protect Yourself From Market Loss

    There are several simple strategies you can use to protect yourself from downside risk.
  4. 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.
  5. 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 ...
  6. Trading Strategies

    Patience Is A Trader's Virtue

    Waiting may be the biggest key to reeling in that trophy investment.
  7. Investing Basics

    Narrow Your Range With Stop-Limit Orders

    With stop-limit orders, buyers protect themselves from prices too high for their tastes.
  8. Trading Strategies

    How to Use Trailing Stops

    A trailing stop is an order to buy or sell a security if it moves in an unfavorable direction.
  9. Active Trading

    Pinpoint Winning Trade Entries With Filters And Triggers

    These tools will help you enter at high-probability points and ensure you trade within your set strategy.
  10. Active Trading Fundamentals

    Trailing-Stop Techniques

    The important decision to exit a position must be based on more than emotion if you want to be a disciplined trader.

You May Also Like

Hot Definitions
  1. Mixed Economic System

    An economic system that features characteristics of both capitalism and socialism.
  2. Net Worth

    The amount by which assets exceed liabilities. Net worth is a concept applicable to individuals and businesses as a key measure ...
  3. Stop-Loss Order

    An order placed with a broker to sell a security when it reaches a certain price. A stop-loss order is designed to limit ...
  4. Covered Call

    An options strategy whereby an investor holds a long position in an asset and writes (sells) call options on that same asset ...
  5. Butterfly Spread

    A neutral option strategy combining bull and bear spreads. Butterfly spreads use four option contracts with the same expiration ...
  6. Unlevered Beta

    A type of metric that compares the risk of an unlevered company to the risk of the market. The unlevered beta is the beta ...
Trading Center