"Why do I buy stocks expensively and sell them cheaply?" No worries if you only know this | Limit order, Market order, Stop-limit order, IOC, KOK, etc. Stock Order Methods (JYP finally explodes??)

Stock trading is governed by core principles: price priority (buyers prioritize higher prices, sellers prioritize lower prices), time priority (the first order placed at the same price is executed first), and quantity priority (larger orders at the same price and time are prioritized).

A limit order allows you to set a specific price to buy or sell a stock. It ensures trades occur at your desired price or better, but if the market price doesn't reach your specified price, the order may not be executed. These orders reset at the end of the trading day. It's recommended for beginners, those who prioritize a specific price over immediate execution, or when dealing with stocks with wide bid-ask spreads or low trading volumes.

A market order prioritizes immediate execution over price. You only specify the quantity, and the trade occurs at the best available market price. While useful for urgent transactions, it can lead to unfavorable prices, especially for stocks with low liquidity. The system places buy orders at the upper limit (highest possible price) and sell orders at the lower limit (lowest possible price) to ensure immediate execution, consuming available stock quantities from the order book.

This order type acts as a limit order during the trading day and, if not filled, converts to a market order at the closing price during the single-price trading session at the end of the day. It's suitable for those who have a desired price but still want to ensure execution by the day's end, or for busy individuals like office workers who can't constantly monitor the market.

A best-price limit order aims for the most favorable price among currently available orders. For buying, it places the order at the lowest ask price (first available sell order). For selling, it places the order at the highest bid price (first available buy order). If the full quantity isn't available at that price, options like IOC (Immediate Or Cancel) or FAK (Fill And Kill) determine how the remaining order is handled.

A best-bid/offer limit order places your order at the front of the queue at the best available bid price (for buying) or ask price (for selling). This means your buy order will be at the highest bid price, and your sell order will be at the lowest ask price, effectively joining the first available position in your preferred direction.

A mid-price order seeks to execute a trade at the midpoint between the best ask price (lowest selling price) and the best bid price (highest buying price). This type of order can result in transactions at uncommon price units not typically available through manual limit orders.

A stop-limit order combines a 'stop price' and a 'limit price'. When the stock price reaches the 'stop price', a limit order is automatically placed at the 'limit price'. This is useful for setting automatic stop-loss orders or for buying when a certain price threshold is crossed, indicating a potential uptrend. Some brokerage firms offer extended order durations for these beyond a single day.