BECOME A MORE PROFITABLE TRADER WITH THE RIGHT EDUCATION

Get on our mailing list so you know when we release free training, live classes, new courses, and even discounts and promotions.

Pros & Cons of a “Market Order” on the Stock Market

Hey it’s Sasha Evdakov and welcome to Tradersfly.com where I share with you some insight about trading and investing on the stock market.

This week I want to share with you the Pros and Cons of a market order now if you’re looking to trade in the stock market, need to understand the different order types. First off before we get into the pros and cons of a market order you need to understand what is a market order and basically, you have two different order types you have a market order and you have a limit order.

The limit order allows you to specify what price you want to purchase a certain stock for so, for example, a stock is trading at $30 and then you want to purchase it at $22 the limit order allows you to specify that you want to purchase it at that $22.


The market order on the other hand says I want that stock and I’m willing to pay whatever the price is in order to get that stock so if you’ve ever been to a fancy restaurant or at least a specialty restaurant where sometimes things are not as abundant for example fish sometimes you will notice on the menu that it says market price so you’ll pay for let’s say grouper sandwich the market price for what it currently is.

Now even though you may have paid for that same grouper sandwich last week twenty dollars this week that market price might be much higher it might be $100 so in theory if you don’t ask what the market price is you may be paying exuberant prices for that grouper sandwich. Now this is probably and typically not realistic but it can happen so always ask for what the market price is at least if you’re in a restaurant.

Unfortunately in the stock market things are a little bit different you don’t really get to ask hey what’s the market price you get to see what the trading prices or what the current prices or what orders have been filled at what price recently but you don’t get to ask really “hey what’s the market price?” because there’s other data showing you at what price range the orders are going off in now if you have a really liquid market meaning there’s a lot of shares traded there’s a lot of activity market orders are typically fine because you’ll get it in very quickly at whatever the rate is because there’s a lot of trades happening at that time.

However if there’s not a lot of trades happening or your trading a really small stocks, stock that doesn’t trade a lot of volume or the market is just maybe more on vacation it’s a holiday or maybe even a half day from those holiday seasons then you could get into some real trouble.

Really if now you’re placing a market order you’re going to pay whatever the rate is at that time and there’s certain times where a stock may jump in very volatile sessions up to $5 or $20 or $50 all within a blink of an eye because there’s nobody there to buy or sell shares especially if you’re trading after hours and you’re putting in market orders this can become really problematic and it’s at that time where you see those stocks spiked up really high or dip really low because people are buying and selling at market prices.

What you really don’t want to happen is for a stock that’s trading $25 you don’t want to be the fool that’s paying $50 for that stock after hours because you put in a market order in there was only one other guy to sell you the shares.


Instead what you want to do is always focus on putting in limit orders however market orders are still really great especially if a stock is exploding to that upside and you need to get into that stock very quickly then you want to play some market order it’s because there’s activity because you’re time sensitive and if you’re time sensitive on your order you need to get in it right away. It’s at that point where market orders are great.

Now unfortunately you still may end up paying slightly higher prices on a market order because you’re looking to get in and your time sensitive but if you’re in a liquid market it may only be just a little bit if you’re in an illiquid market or very light trading volume you may pay exuberant prices so it’s a trade-off do you really want to get into that stock very quickly or you’re looking to really look at what price you’re paying for that stock.

Personally I always recommend that you go ahead and place limit orders especially if you’re new you’re just getting started and you’re unsure of what type of order to place always start with a limit order. As you start developing experience and things become a little bit more active for you in trading then market orders may be a good idea at certain specific times.

Again it’s a strategy it’s because you’re time-sensitive you really need to get into the stock or you’re just buying a ton of shares that you just don’t care what price you’re getting into the stock but in general focus on limit orders however market order still can be great at those appropriate times if you definitely want to get into the stock and you’re very time sensitive.


To summarize what are the pros and cons of market orders. Well basically you can get into the stock at any point as long as you’re willing to pay the higher prices for those stocks unfortunately because of that you may also pay exuberant prices or unexpected prices if the market is not as liquid so again another downside is if there’s an illiquid market you’re going to be paying higher prices however you do have a higher chance or higher probability of getting into a stock or a trade or not missing a run to the upside if you place a market order rather than you may miss the stock or the run to the upside if you’re placing a limit order if your limit is not so tight to the market price.

In addition if you’re looking to purchase a large lot of shares through a limit order sometimes it’s very difficult whereas with a market order you can definitely get the amount of shares that you’re looking for so long as that you’re willing to pay the price and finally if your trading not liquid stocks or not in a liquid market but you still need to execute the trade go ahead place the market order and then you’ll get into the trade.

In the end if you’re looking to get into the stock, market is not liquid in you really need to get into it and you’re time sensitive market orders are great however if you care more about the price if you’re really conscious about your risk then stick to limit orders which is typically the route I always advise for most people.

Thanks for joining me in this video if you enjoy this video and you want to see other great videos and min lessons that we have available you can click this link when you get there you can enter your name and email address and we send other great free goodies and free trainings through the newsletter list and while you’re there you can also browse the web site and take a look at some of the other free training that we have available.

If you just want to see some of the other videos I have in the channel then just click one of the thumbnails below and we’ll continue learning together thanks again for joining I’m Sasha Evdakov and remember to do what you love contribute to others but most importantly live life abundantly I’ll see you next time!

Join other stock who get a trading edge each week with our newsletter

Get our free stock market tip, video reviews, and exclusive announcements.

No spam, no gimmicks, no junk - Unsubscribe anytime

I'M SASHA.

Thanks for joining me on my trading website where I share with you about trading stocks and options.

DOWNLOAD 100 Stock trading tips Book

Ready to check out some of our best-selling books that can help you become a better and more profitable trader? Check them out by clicking the link below… 

Video recaps on the recent market trends

Summary of recent market activity looking at swing chart opportunities, potential setups, and technicals.

Stock market picture charts annotated

Quickly review screen captured stock charts with annotations. Includes support, resistance, ABCD patterns, and possible breakouts.

want some helpful advice?

Pay-Per-Minute Coaching

I am scheduling helpful coaching sessions for people who are interested in real-world advice & guidance where you only pay per session. No long term commitment required.

This website and content is for information purposes only as Rise2Learn, TradersFly, and Sasha Evdakov are NOT registered as a securities broker-dealer nor an investment adviser. No information herein is intended as securities brokerage, investment, tax, accounting or legal advice, as an offer or solicitation of an offer to sell or buy, or as an endorsement, recommendation or sponsorship of any company, security or fund. Rise2Learn, TradersFly, and Sasha Evdakov cannot and does not assess, verify or guarantee the adequacy, accuracy or completeness of any information, the suitability or profitability of any particular investment, or the potential value of any investment or informational source. The reader bears responsibility for his/her own investment research and decisions, should seek the advice of a qualified securities professional before making any investment, and investigate and fully understand any and all risks before investing. Rise2Learn, TradersFly, and Sasha Evdakov in no way warrants the solvency, financial condition, or investment advisability of any of the securities mentioned in communications or websites. In addition, Rise2Learn, TradersFly, and Sasha Evdakov accepts no liability whatsoever for any direct or consequential loss arising from any use of this information. This information is not intended to be used as the sole basis of any investment decision, nor should it be construed as advice designed to meet the investment needs of any particular investor. Past performance is not necessarily indicative of future returns.

Ready to Learn Profitable Strategies to Trading Stocks?

If you are serious to learn how to trade stocks more profitably, make more money, and trade with confidence...

 

Then sign up to get our free educational videos!

AWESOME!

In order for you to get your goodies and freebies you have to confirm your email address.

 

To confirm your email address, just go to your email inbox (or check your spam) and click the link that's inside the email that states you want to receive messages from us.

 

That's its!

Just one more thing... 

Ready to Get Our Educational Videos Each Week?

If you are serious to learn how to trade stocks more profitably, make more money, and trade with confidence...

 

Then sign up to get our free educational videos!

AWESOME!

In order for you to get your goodies and freebies you have to confirm your email address.

 

To confirm your email address, just go to your email inbox (or check your spam) and click the link that's inside the email that states you want to receive messages from us.

 

That's its!

Just one more thing... 

Ready to Get Our Educational Videos Each Week?

If you are serious to learn how to trade stocks more profitably, make more money, and trade with confidence...

 

Then sign up to get our free educational videos!

AWESOME!

In order for you to get your goodies and freebies you have to confirm your email address.

 

To confirm your email address, just go to your email inbox (or check your spam) and click the link that's inside the email that states you want to receive messages from us.

 

That's its!

Just one more thing... 

Portfolio Allocation - Percentage of Each Stock

If you are serious to learn how to trade stocks more profitably, make more money, and trade with confidence...

 

Then sign up to get our free educational videos!

Quickly Calculate Mid-Day Volume

This Excel sheet will allow you to quickly find out if your stock's volume is trading above or below the daily average during the middle of the day.

Top 15 Dividend Stocks for Retirement in 2020

Download our list of the best stocks for retirement. Simply enter your email address below to get the PDF!

Buying or Building a Trading Computer for 2020

Learn how to buy the right computer for your trading needs or choose the perfect parts if you are custom building a trading computer!

 

 

VIDEO COURSE

Top 25 Tech Gear for Traders

If you are serious to learn how to trade stocks more profitably, make more money, and trade with confidence...

 

Then sign up to get our free educational videos!

Awesome Phone Apps for Traders

Discover these awesome phone apps most traders use on trading! Earn money anytime, anywhere with these apps!

Top 7 Dividend Paying ETF's for 2020

Want to know the top 7 ETFs that pays the biggest dividends in 2020? Download this list now and start earning your dollars!

10 Hot Stocks Warren Buffet Loves

Trade and earn like Warren Buffet! Here are the stocks he invests in!

 

Get the list now and start earning your money!

Do you want to download a list of over 125+ popular stocks that you should keep your eye on?

 

Enter your email below and we will email you the list of 125+ hot stocks!

OPTION TRADING GEEKS

Download my easy worksheet so that you can quickly see and know what the greeks will do to your position! 

 

Enter your email address below to download it!

OPTION STRATEGIES

Enter your email address below and get access to our video strategy session on 25+ option strategies and how to set them up!

25

How Long Will it Take to Reach $1,000,000 in The Stock Market?

Want to see for yourself how long it will take you to reach $1,000,000 based on your personal return?

 

Then download my Excel cheatsheet for FREE to see and play with the numbers!

OPTIONS GREEKS

Ready to get a deep understanding of the option Greeks?

 

Get access to my video training by entering your email address below!

VIDEO TRAINING SESSION

Ready to Get Our Educational Videos Each Week?

If you are serious to learn how to trade stocks more profitably, make more money, and trade with confidence...

 

Then sign up to get our free educational videos!

AWESOME!

In order for you to get your goodies and freebies you have to confirm your email address.

 

To confirm your email address, just go to your email inbox (or check your spam) and click the link that's inside the email that states you want to receive messages from us.

 

That's its!

Just one more thing...