Hey everyone! Ross here from Warrior Training I Want to talk about the different order types that you have your disposal when you're taking a trade? Now, it doesn't matter whether you're taking a day trade, a swing trade, or you're buying a long-term investment, these are still order types that you have to consider. Now the three order types that we look at the first one is a market oil. Now the way a market order works is you say I want to get into this stock by buying X number of shares and I don't care what price I'm gonna get into I will get in at market price. The risk with a market order is that if you accidentally have a typo in a number of shares, you type instead of typing 10,000 you type 100,000 and then you press the Buy button.

Now the computer systems that take in all these orders. Their job is to execute your order to buy a hundred thousand shares at current market price. If there are not currently a hundred thousand shares for sale at the current price, then you'll buy all the shares for sale at that price and all the shares for sale. The next penny up, the next penny up next, pay up next penny up and what you might see is you go Boom! You end up buying at 25, 30, 40, 50, even 75 cents or a dollar higher than the current market price.

So most active traders would not want to use a market order because the risk that you could get filled at a really bad price is simply too high and so what. We will instead use our limit orders by using a limit order. We're still saying we want X number of shares, but we're saying we won't pay a penny more than this limit price. And so when we look at the order entry window and I'll do this on my computer so you can see in the case of ZB z the zzt the Nasdaq test stock, the current price is ten dollars and two cents.

So if I want to buy this if I want to buy 10,000 shares, that could be a problem because there are not 10,000 shares for sale right here. So if I press buy right just like this, this might not let me do it. No, it did. and because this is a test stock, it just went ahead and placed the order.

But if this was an actual an actual stock, I would not have been able to fill all the shares at 10:02 I would have filled at 10:02 10030 for maybe even all the way up at 1042 and I would have gotten a really bad fill. So instead and that's if I had used a market order now. So with a limit order by putting it at 10:02 if I had done this with real money, most likely I might have filled six hundred shares at 10:02 and then the rest would have been sitting there as a buy order waiting for maybe some people to sell me shares at that price. So by using a limit order what I'm doing is I'm saying the most I'm willing to pay is this price right here.

Some people get this confused and they think that the order will not go through until this price and that's not true. A limit order is the most you're willing to pay and so as soon as you press the Buy button, this order will get sent to the market and you will start getting shares up until the top of your limit price. On the other hand, when you want to go ahead and sell the stock, I could put an order down here if I put in order to sell it at 10:05 Obviously the order is just gonna sit there because the current price is 1001 by 1002. So if I want to sell it at 1001, what I'm going to need to do is cancel that open order right here by right-clicking and go and cancel and then bring my limit order down to let's say $10 maybe even I go a little below at 998 and then I type in my 13,000 share sale order and there we go I'm out and I got filled mostly at looks like 99 or so.

Alright so and this is what most traders are going to use now. in addition to market orders and limit orders, you have what are called stop orders. This is the third type of order. A stop order is an order that will not trigger until the price crosses a certain a certain price until a price that you determine.

So what I could do in the case of Zv z ZT is I could say and let's say I want to buy this but I don't want to buy it until it crosses 10:05 So I'm going to change the order type to a stop limit order and I'm going to put my stop price at 10:05 And now if I use just a regular stop order then it's going to be a market order as soon as 1005 hits and so I might get filled at ten Ten Ten Fifteen Ten twenty. So I'm going to use a stop limit order to limit. The upside of what I'm willing to pay, the stop price is the trigger price and the limit is the most I'm willing to pay. So if I do this and I press buy, that order will sit there because it's a day order.

It will sit there for the rest of the day and if the price breaks ten dollars and five cents I will my order will get sent to the market. but I will not get filled any higher than ten dollars and ten cents. On the other hand, what you could do. this is called a buy stop order and I'm gonna go ahead and cancel it.

The other thing that you could do is you could do a traditional stop order. So I'm gonna get in this here just by three thousand shares. Let's see, let me switch that here. Switch to limit by Okay Oh ZV is easy.

Maybe that was the problem? All right, Bye there we go. So I've got my three thousand shares now. so let's say I want to use a stop order to control my downside risk. What I can do is I can say let's put a stop order at $9.99 with a limit of nine Ninety and press sell.

Now if the stock drops below and triggers $9.99 that's my, that's my trigger price. My stop order will fire and I will sell my shares at a price no lower than nine dollars and ninety cents. The biggest risk here is that if the stock suddenly drops to Nine eighty or Nine Seventy, I will still be holding shares and I will be losing more and more money because the stock is going down. So the three most popular order types are your limit orders, your market orders, and your stop orders.

As you can see, there are a number of other order types including trailing stops, but we won't go into those right now. I'll just talk about these three which are the most popular. All right. I Hope this video has been helpful as usual.

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