Understanding the Types of Orders in Stock Market Trading

Published on: February 24, 2025

Understanding the different types of orders is essential for effectively executing your trading strategies in the stock market. Each type of order serves a unique purpose and can impact how quickly, at what price, and under what conditions your trade is executed. Here is a breakdown of some of the most common types of stock market orders with TradePoint, Zone Web, and Zone Mobile.

1. Standard Order

Positional Order

The Positional Order is specifically used for traders and investors willing to buy the delivery of the stock.

Example: You want to buy a stock that has fallen to ₹200, assuming that it can give good returns in one month. You will buy with the Positional Order as you are planning to hold it for more than a day.

Intraday

The Intraday Order is specifically used for intraday trading and also known as MIS. This order type allows you to trade more than the cash balance in your account by leveraging your capital.

Since the trade is intraday (i.e., it must be squared off before the market closes), Definedge Securities has a policy of squared-off intraday positions by 3:10 p.m.

Limit Order (LMT)

It’s an order to buy or sell a stock at a specific limit price but with the flexibility to execute at the best available market price within that limit. This type of order is primarily used to ensure that the trade happens within a certain price range.

The order allows you to set a limit for the price but still allows for the market to fill the order promptly within the limit.

Example: You want to buy a stock but don’t want to pay more than ₹500. The stock may be trading at ₹505. A Limit Market order will buy the stock at ₹500, depending on market conditions.

Market Order (MKT)

A market order is the simplest type of order. It’s an instruction to buy or sell a stock immediately at the current market price. The trade is executed as soon as possible at the best available price. Market orders are typically used when the priority is to execute the trade quickly, and there is little concern about the exact price.

Example: If you place a market order to buy 100 shares of a stock, the order will be executed at the best price available at that moment.

SL-Market (Stop Loss Market Order)

A Stop-Loss Market order limits potential losses on an existing position. When the price of a stock reaches the predefined stop-loss level, the order is automatically triggered and executed at the best available market price.

This order type does not guarantee an exact price; once the stop-loss condition is met, the execution is at the prevailing market price.

Example: If you own a stock at ₹500, you can set a stop-loss order at ₹480. If the price falls to ₹480, the SL-Market order will trigger and the position will be sold at the best available price.

SL-Limit (Stop Loss Limit Order)

A Stop Loss Limit order is similar to an SL-Market order but with a limit price. After the stop price is triggered, the order will only execute at the limit price or better. This type of order ensures that the trade is executed at a price you are willing to accept.

The trade is not guaranteed to execute if the market price does not meet the limit price.

• Example: If you set a stop loss for a stock at ₹480 and a limit of ₹475, the order will only execute at ₹475 or better if the stock hits ₹480.

2. AMO (After Market Order) An AMO allows you to place an order outside regular market hours. Orders placed using AMO are queued and will be placed when the market opens the next day.

AMO orders are placed after-market hours, typically between 5:01 PM and 8:59 AM, but they are executed only once the market opens.

Example: If you want to place an order for a stock at ₹300, you can place an AMO after 5:01 PM, and the order will be executed the next day when the market opens (if the price is actually trader the next day)

3. Covered Order

A covered order is a type of order that helps traders place the buy and sell order along with the stop-loss. It is typically used by traders who want to limit their losses if the trade goes against them.

Example: If you own 200 shares of a stock at ₹500 and want to place a stop-loss at ₹490, you could place a covered order.

4. GTT (Good Till Triggered)

A GTT order is a long-term order where you set a condition that, once triggered, will execute your buy or sell order. This order stays active until the specified trigger condition is met or the order is manually cancelled.

*Note – You need to Create GTT order from the left bottom option.

The order remains active for 365 days in terms of cash segment. For Futures & Options segment, the order will remain active till the expiry contracts are active.

Example: If a stock is currently trading at ₹350, you can place a GTT order to buy if it goes to ₹300. The order will remain active until the stock hits ₹300.

5. Slicing Order

A Slicing order is a type of large order that is broken down into smaller parts.

This is used to minimize the market impact of large trades, as it prevents revealing the full size of the order.

Example: If you want to buy 10,000 shares but don’t want to push the price up too much, you could use an iceberg order that shows only 1,000 shares at a time until the entire order is filled.

6. Iceberg Orders

An Iceberg order is a type of large order that is broken down into multiple slices. The second slice orders will be placed only after the previous slice orders are executed.

7. Options Orders

Options orders relate to buying or selling options contracts rather than underlying stocks. These orders types can help to trade multiple legs at one click.  You can place these orders with limits, stop-losses, or market prices.

Happy Trading!