In addition to market, limit, stop and conditional orders, traders can also specify for how long they wish the order to be in effect; that is, how long the order will remain in the market until it is canceled (assuming it is not filled). Order entry interfaces typically provide several options; Figure 9 shows the options that are available on TradeStation (other trading platforms may have slightly different options).
Figure 9 - The various types of orders traders can use to specify how long an order will remain active in the market. Image created with TradeStation.
A day order automatically expires at the end of the regular trading session if it has not been executed. Many platforms use this as the default order duration. A "Day +" duration is valid until the end of the extended trading session.
Good-Til-Canceled - GTC
A good-til-canceled order is active until the trade is executed or the trader cancels the order. Brokers typically cancel GTC orders automatically if they have not been filled in 30 to 90 days.
Good-Til-Date - GTD
A GTD order remains active until a user-specified date, unless it has been filled or canceled.
Immediate-Or-Cancel - IOC
An IOC requires all or part of the order to be executed immediately; otherwise, the order (or any unfilled parts of the order) will be canceled.
Fill-Or-Kill - FOK
An FOK order must be filled immediately in its entirety or it will be canceled. Partial fills are not accepted with this type of order duration.
All-Or-None - AON
Similar to an FOK, an AON order will be canceled if the order cannot be filled in its entirety by the end of the trading session. Partial fills are not accepted with this type of order duration.
An at-the-opening order will be executed upon the opening of the trading session. If the order cannot be executed at the open, it will be canceled.
At the close (or "on close") orders are executed at the close of the trading session, at or as close to the closing price as possible.
Minute orders expire after the specified number of minutes has elapsed. Common intervals include one-, three- and five-minute order durations.
Knowing how to trade can be important as knowing when to trade. Understanding the different order types and how to apply them can help traders streamline the order entry process and avoid costly slippage and unnecessary losses.
Advanced order types, such as OCO and OSO orders, act as a basic form of trade automation, since many of the orders, once defined, are handled by the trading platform. Trade automation, whether at a basic level or as a fully automated trading system, can help traders control emotions, avoid costly pilot error mistakes and protect open trades with profit targets, stops and trailing stops.
TradingIn this short instructional video Anton Theunissen explains what the "fill or kill" order is.