A market order is an instruction to buy or sell an asset immediately at the best available price. It prioritises speed of execution over price precision, making it suitable for highly liquid markets where slippage is minimal. Market orders are commonly used by traders who want to enter or exit positions quickly, especially during fast-moving conditions. However, in illiquid markets or volatile periods, market orders may execute at unfavourable prices. They’re simple to use but should be applied with caution, particularly when large volumes are involved. Traders often combine market orders with stop-losses to manage execution risk.
Example:
An investor buys Shares immediately at the best available price.
