Understanding of Order Types
Understanding of Order Types

Understanding of Order Types

Mon, Apr 11, 2022 9:58 AM

Make the right moves at the right time & price could help you trade effectively. When you trade with Rakuten Trade (both web & iSpeed), you’re allowed to customize your order to your pocket’s content.

What are the choices you could have??

 Market Order

  • An order to buy or sell a stock at the current market price.
  • Advantage: It is almost always guaranteed that the order will be executed (if there are willing buyers and sellers).
  • Note:
    1. Rakuten Trade’s Market Buy Order requires more trading limit. This is to ensure the immediate execution of Market Buy Order to match to the best available seller price(s) in the market depth.
    2. Illustration as table below:
Current Market Price Trading at Rakuten Trade Market Order Price Band Percentage & RM Minimum Trading Limit Require
RM 1.00 and above 30% (above current market price) RM 1.00 + 30% + Brokerage (plus 6% Service Tax) + Stamp Duty + Clearing Fees
Below RM 1.00 RM 0.30 (above current market price) RM 0.90 + RM 0.30 + Brokerage (plus 6% Service Tax) + Stamp Duty + Clearing Fees

 

Limit Order

  • An order to buy or sell a stock at a predetermined price.
  • An order to buy a stock at a predetermined price that is at or lower than the current price.
  • An order to sell a stock at a predetermined price that is at or higher than the current price.
  • Advantage: Allow you to purchase / sell a stock at your desired price.
  • Disadvantage: There is no guarantee in the fulfilment of the orders as it is subjected to the market conditions and if any willing buyers / sellers.

 

Stop Market Order (NEW!!)

  1. Buy Stop Market Order
  • I want to buy when price break resistance.
  • I set a higher trigger price and buy at the market price if the share price breaks above a certain level before it’s too late.
  • A Buy Stop Market Order will be triggered and become a Market Order when the last done price hits or rises above stop price.

  1. Sell Stop Market Order
  • I want to manage my losses as the share price is falling.
  • I set a lower trigger price and sell at the market price to manage my risk if the share price breaks below a certain level before it’s too late.
  • A Sell Stop Market Order will be triggered and become a Market Order when the last done price hits or drops below stop price. 

To learn more, refer to the Tip Sheet or Video Tutorial

Stop Limit Order (NEW!!)

  1. Buy Stop Limit Order
  • I want to buy when price break resistance as the stock price is rising.
  • I set a buffer between my higher trigger price and the highest final price I can accept to manage my risk if the share price breaks above a certain level before it’s too late.
  • A Buy Stop Limit Order will be triggered and become a Limit Order when the last done price hits or rises above stop price. 

 

  1. Sell Stop Limit Order
  • I want to manage my losses as the stock price is falling.
  • I set a buffer between my lower trigger price and the lowest final price I can accept to manage my risk if the share price breaks below a certain level before it’s too late.
  • A Sell Stop Limit Order will be triggered and become a Limit Order when the last done price hits or drops below stop price. 

 

To learn more, refer to the Tip Sheet or Video Tutorial