What is Away From The Market
Away from the market is an expression that is used in two different scenarios when a buy or sell price deviates from a specific related benchmark. This can happen when the bid on a limit order is lower than the current market price or the offer price is higher than the current market price for a particular security.
BREAKING DOWN Away From The Market
Away from the market order is a type of limit order where the sell order is above and the buy order is below the current market price at that time.
A limit order is one where the order is placed with the brokerage, which will execute a buy or sell transaction involving a pre-determined number of shares with a set limit price that must be met or exceeded. Limit orders set parameters which give the investor an extra level of control, because it allows them to limit to period of time in which an order can be in progress and pending before it will be canceled.
A limit order is a good option if there is a specific price that you want or need to get. When you place an order of this type, there is no guarantee the order will be executed, and there is a possibly it will not be. However, if the order is executed, you are guaranteed to get at least the price which you have established when you put the order in place.
Away from the Market Order Example
An away from the market order is a limit order to buy at a price lower than the current market price and an order to sell at a price higher than the current market price.
Away from the market limit orders are typically held for later execution, unless specified as Fill or Kill (FOK) orders, which are orders that must be completed right away and executed fully, or they will be canceled. Away from the market refers to orders that are entered at a price that is not immediately available. For example, a limit order to buy 100 shares of Acme Corporation at $28.00 is away from the market if the stock is presently trading at $32.00 per share at that time. Similarly, a limit order to sell 100 shares of Acme Corporation at $36.00 is also away from the market when shares are currently trading at $32.00.
In addition to limit orders, other types of orders include a market order and a stop order.