Order types: market, limit, stop and stop-limit

The lesson in plain words

The same lesson as the slides above, written out in full.

1. Four ways to place a trade

Welcome. Before you ever worry about which stock to buy, it helps to understand the four ways you can actually place the order. Each one answers a simple question: do you care more about getting filled fast, or filled at a specific price? By the end of this lesson you will know which tool fits which moment.

• A market order fills right now at the best available price
• A limit order fills only at your price or better
• A stop order stays dormant until price hits a trigger level
• A stop-limit adds a price cap once the stop triggers
• Picking the right type controls your fill price and your certainty

A quick note: This is financial education only, not financial advice. All prices and dollar figures here are illustrative examples to teach the mechanics, not recommendations. Order behaviour varies by broker and market conditions, so always check how your own platform handles each type before trading real money.

2. Market order: fill now, accept the price

A market order says one thing: fill me now, whatever the going price is. In a busy, heavily traded stock that price is usually very close to what you saw on screen. But in a fast-moving or thinly traded name, the price can shift in the split second it takes to fill, and that difference is called slippage. Use it when speed is the priority, and expect the fill to be roughly, not exactly, where you looked.

• A market order prioritises speed over price
• It fills almost instantly in a liquid, active name
• The trade-off is slippage, the gap between the expected and actual fill
• Slippage tends to widen in fast or thin markets
• Best when getting in or out quickly matters most

3. Limit order: your price or better

A limit order flips the priority: now price matters more than speed. You name the worst price you will accept, and the order simply waits until the market comes to you. The upside is you never get a nasty fill; the honest downside is that if price never reaches your level, you sit on the sidelines and miss the move. It rewards patience over urgency.

• A limit order sets the worst price you are willing to accept
• A buy limit fills at your price or lower
• A sell limit fills at your price or higher
• You control the price, but the order may not fill at all
• Great for patient entries and avoiding slippage

4. Stop and stop-limit: waiting on a trigger

A stop is a sleeping order: nothing happens until price touches your trigger level. A plain stop then wakes up as a market order, so it almost always fills but may slip in a fast move. A stop-limit wakes up as a limit order instead, protecting your price but risking no fill if the market gaps straight past it. These are just execution tools; at Titan the stance stays long-only with clearly defined risk, and a bearish view is expressed through long put options rather than short-selling.

• A stop sits dormant until price reaches the trigger level
• Once triggered, a plain stop becomes a market order
• A stop-limit instead becomes a limit order at your chosen cap
• A stop-limit protects your price but can miss a fast move
• Titan stays long-only with defined risk; bearish views use long put options, never short-selling