What are the available order types? (US options and futures)

When placing a market order, you are guaranteed an order fill as long as there is a bid price (greater than 0.00) when selling or an ask price when buying. Market orders are only available for stocks, ETFs, single-leg equity options, futures*, and single-leg options on futures*. Market orders are not available for any multi-leg options orders (spreads). However, there are pros and cons to market orders.

Pros: When routing a market order you are guaranteed that your order will fill in its entirety or partially (when there is no market). For example, if you route an order to buy 500 shares of XYZ @ MKT and the current ask price is $20, then your entire order will fill.

Cons: When routing a market order you have no control over what price you are filled at, whether you are buying or selling. When routing a market order, you are essentially stating that you are willing to get filled at any price. Using the same example, routing an order to buy 500 shares of XYZ @ MKT although the ask price at the time of order entry was $20 does not mean entire the order fills at $20, although it is possible.

As a result, your order may partially fill at $20, but the remaining lot can fill at a price above or below $20 depending on market movement. When selecting Market as your order type for stocks, MKT will appear in the price field, indicating that your order will fill at the market. Additionally, market orders are not available for any multi-leg options orders (verticals, iron condors, calendars, etc.).

*One exception to market orders when trading futures and options on futures.

A limit order, by definition, is an order type that guarantees the price you entered or better. This rule applies to equities, equity options, futures, and options on futures. That means if you have a limit order to buy 100 shares of XYZ @ $50, then the order will be filled at $50 or lower and vice-versa when selling.

Pros: You are guaranteed the price you entered or better IF the market reaches your order price. For example, if you route an order to buy 200 shares of XYZ @ $20, then your order can be filled at $20 or less if the market reaches your limit price. On the contrary, if you are selling 200 shares at $20, then your order can be filled at $20 or more.

Cons: Since you are specifying a price your order may not get filled because the market may never reach your limit price. Using the same example, if the market for XYZ is $23 bid by $24 ask and you are trying to buy 200 shares @ $20 (bid), then your order may fill since the ask price would need to drop to at least $20 to fill.

A stop market order allows you to exit a position if the stop price is breached. When you select a stop market, all you need to enter is a stop price since a market order is immediately executed when the stop price is met or breached. As a result, a stop market fill price is unknown since the order will hit the next bid when selling to close or the next ask when buying to close. Although your order is executed you may get an unfavourable fill if price movement was due to a “knee-jerk” reaction. Furthermore, futures orders are subject to CME's Market Order with Protection handling. As a result, stop market orders on futures have the potential to not fill if the underlying moves outside the protection price limit zone.

If you are seeking an order type that can help protect your gains or prevent additional losses, stop orders can be an excellent addition to your trading repertoire. Please remember to select a Time-In-Force (TIF) for your stop order. Your TIF options include placing a Day, GTC, or GTD order for equity and equity options. However, at this time futures may only use Day orders. Selecting a TIF will maintain the stop according to your TIF selection. Also, stop orders are not supported during the pre-market and after-hours trading session (EXT).

Inputting a stop market order for a long stock

Again, we'll be using F stock that was purchased at $12.50. In this case, to prevent further losses we will initiate a market order if the stock hits $12.

Inputting a stop market order for a long option

For this example, we will set a stop market order in Table mode to route a sell to close market order for a long F Mar 11.83 put. The Stop Trigger will route a market order when the Ask price dips down to $0.10. First, line up a closing order from the Portfolio tab, then select Stop Market from the Order Type dropdown menu, as illustrated below.

After selecting Stop Market from the Order Type dropdown menu, a Stop Trigger price field will appear (yellow outline). However, since a market order routes when the stop is triggered, the Limit Price field disables. Lastly, select a Time-In-Force (red arrow).

A stop limit order allows you to indicate a “stop price” and a “limit price”. The stop price will act as a flip-switch, and once the underlying security hits the stop price, the switch is flipped, which triggers the entry of a limit order. A stop price to sell is triggered when the security is at or dips below the stop price. A stop price to buy will be triggered when the security is at or rises above the stop price. You will be filled at your specified limit price or better. When entering a stop limit order, the limit price can be the same as the stop price. That said, stop limit orders do not guarantee a fill since your order may remain resting if there is a gap up or gap down since your limit order could be away from the market.

What triggers a stop price?

• For stock & futures buy and sell orders, the stop price triggers by the last price at the specific exchange the order rests on, not necessarily the NBBO.
• For option buy orders, the stop price triggers by the bid price or a trade at the specific exchange the order rests on, not necessarily the NBBO.
• For option sell orders, the stop price triggers by the ask price or a trade at the specific exchange the order rests on, not necessarily the NBBO.

When considering a stop order, please keep in mind that the stop order will remain on the routed exchange. As a result, although the stop may appear to trigger due to the National Best Bid and Offer (NBBO), which quotes on our platform, the stop may not trigger if the quote does not print on the exchange where the order rests.

Inputting a stop limit for long stock

For this example below, we purchased F for $12.50 and want to sell 1 F share at $11.90 (limit order) if the last price hits $12.

Inputting a stop market order for a long option

For this example, we will set a stop market order in Table mode to route a sell to close market order for a long F Mar 11.83 put. The Stop Trigger will route a market order when the Ask price dips down to $0.10. First, line up a closing order from the Portfolio tab, then select Stop Market from the Order Type dropdown menu, as illustrated below.

After selecting Stop Market from the Order Type dropdown menu, a Stop Trigger price field will appear (yellow outline). However, since a market order routes when the stop is triggered, the Limit Price field disables. Lastly, select a Time-In-Force (red arrow).