Away From The Market Order:
An away from the market order is a type of order placed by an investor to buy or sell a security at a specific price that is different from the current market price. This order is executed only when the market price reaches the specified price level. Away from the market orders are typically used by traders who believe that the current market price does not accurately reflect the true value of the security and wish to enter or exit a position at a more favorable price. These orders can be limit orders, where the specified price is higher for a sell order or lower for a buy order, or stop orders, where the specified price is lower for a sell order or higher for a buy order. Away from the market orders provide investors with more control over their trades and allow them to potentially achieve better execution prices. However, there is a risk that the market may not reach the specified price, resulting in the order not being executed.
An “Away From The Market Order” is a type of order placed by an investor in the financial market that specifies a price at which they are willing to buy or sell a security, which is different from the current market price. This order is typically used when an investor believes that the current market price does not accurately reflect the true value of the security and wants to execute the trade at a more favorable price.
When an investor places an Away From The Market Order, it is sent to the market and remains active until it is either executed or canceled. If the specified price is reached, the order is executed, and the investor buys or sells the security at the desired price. However, if the specified price is not reached, the order remains open until it is canceled by the investor or expires.
It is important to note that Away From The Market Orders may not be executed immediately, as they are dependent on the market reaching the specified price. Therefore, there is a risk that the order may not be executed at all if the market does not move in the desired direction.
Investors should carefully consider the risks and benefits of placing an Away From The Market Order, as it involves a deviation from the current market price and may result in missed opportunities or unfavorable execution prices. It is advisable to consult with a financial advisor or broker before placing such orders to ensure they align with the investor’s investment goals and risk tolerance.
Q: What is an Away From The Market order?
A: An Away From The Market order is a type of order placed by an investor to buy or sell a security at a price that is significantly different from the current market price.
Q: Why would someone place an Away From The Market order?
A: Investors may place an Away From The Market order when they believe that the current market price does not accurately reflect the true value of the security. They may want to buy at a lower price or sell at a higher price than what is currently available in the market.
Q: How does an Away From The Market order work?
A: When an Away From The Market order is placed, it is not executed immediately. Instead, it remains in the order book until the specified price is reached. Once the market price reaches the specified price, the order is executed.
Q: Are there any risks associated with Away From The Market orders?
A: Yes, there are risks involved with Away From The Market orders. Since these orders are not executed immediately, there is a possibility that the market price may never reach the specified price, resulting in the order remaining unexecuted.
Q: Can I cancel an Away From The Market order?
A: Yes, you can cancel an Away From The Market order as long as it has not been executed. Once the order is executed, it cannot be canceled.
Q: Can I modify the price of an Away From The Market order?
A: Yes, you can modify the price of an Away From The Market order as long as it has not been executed. Once the order is executed, the price cannot be modified.
Q: How long does an Away From The Market order remain in the order book?
A: The duration of an Away From The Market order depends on the specific instructions provided by the investor. It can remain in the order book until the specified price is reached or until the order is canceled.
Q: Are there any additional fees associated with Away From The Market orders?
A: Some brokers may charge additional fees for placing Away From The Market orders. It is advisable to check with your broker regarding any potential fees before placing such orders.
Q: Can I place an Away From The Market order for any security?
A: The availability of Away From The Market orders may vary depending on the specific security and the rules of the exchange or market where it is traded. It is recommended to check with your broker or the exchange for the availability of this order type
This site contains general legal information but does not constitute professional legal advice for your particular situation. Persuing this glossary does not create an attorney-client or legal adviser relationship. If you have specific questions, please consult a qualified attorney licensed in your jurisdiction.
This glossary post was last updated: 29th March 2024.
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