What is Market order?
Market buyurtma
In short
An order executed immediately at the best available price. Fast, but the exact price is not guaranteed.
A market order says "execute now at the best price available". A market buy fills at the lowest ask, a market sell at the highest bid. Its strength is speed and a near-certain fill. Its weakness is that the exact price is not guaranteed.
Where the price comes from
The "last price" on screen is the previous trade, not yours. A market buy works through the asks in the order book, starting from the cheapest. If there are not enough shares at the best price, the rest fills at the next, higher prices. The average price can therefore end up worse than expected — that is slippage.
When it fits
- Highly liquid stocks (large companies, broad ETFs) in the regular session, in modest size.
- When getting out fast matters most — for example, when you must exit a position immediately.
When it is risky
- In thinly traded stocks and with wide spreads.
- In the first minutes after the open and around news and earnings.
- In pre-market and after-hours (many brokers do not accept market orders then at all).
Whenever price matters, a limit order is the safer choice.
Example
The sell side (asks) of a fictional stock's order book:
- $25.00 — 300 shares
- $25.05 — 500 shares
- $25.10 — 1,000 shares
You send a market buy for 1,000 shares, expecting to pay $25.00:
- 300 × $25.00 = $7,500
- 500 × $25.05 = $12,525
- 200 × $25.10 = $5,020
Total: $25,045, an average price of $25.045. Compared with what you expected: $0.045 × 1,000 = $45 of slippage. With 100 shares, everything would have filled at $25.00 — the problem is order size relative to liquidity.
Mistakes and tips
Look at the bid and ask before sending a market order: if the spread is wide, use a limit order.
Compare a large order with the size available in the book — if the best price does not have enough shares, the price will move against you.
Avoid market orders at the open and in the minutes around earnings and news: the price can jump in a second.
Frequently asked questions
- At what price does a market order fill?
- A buy fills at the sellers' lowest offer (ask), a sell at the buyers' highest bid. A large order can fill across several price levels.
- Market or limit order — which is better?
- If speed matters and the stock is very liquid, a market order is convenient. If the price matters or the stock trades thinly, a limit order is safer.
Learn it in the Academy
This term is covered with hands-on examples and a quiz in these lessons of the interactive course.
- How the US market worksExchanges and brokers, sessions in Tashkent time, spread and liquidity, five order types with examples, T+1, costs and fractional shares.Open lesson · 12 min
- Demo trading: practice without money, but seriouslyMaking demo realistic, a 30-day plan, which numbers to track and when to move to real money.Open lesson · 11 min
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