Market order: execute now at the best available price
A market order tells the broker to execute your trade immediately at whatever the market is offering right now. Speed is the priority, you get your shares (or cash) fast, but you accept the current price, whatever it happens to be.
Example: Apple is trading at 215.50 USD. You place a market buy order. The trade executes within seconds at the best available price at that exact moment, which might be 215.50 or 215.53 if the price ticked slightly between your tap and the execution.
Limit order: only trade at your price or better
A limit order lets you specify the maximum price you will pay (for a buy) or the minimum price you will accept (for a sell). The order only executes if the market reaches your target. If it never does, the order stays pending, or expires.
Example: Apple is at 215.50 but you only want to buy if it drops to 210. You set a limit buy at 210. If Apple falls to 210 or below, your order executes automatically. If it never reaches 210, nothing happens and no money is moved.
When to use each
Use a market order when speed matters more than a precise price, for large, heavily traded stocks like Apple, Tesla, or Amazon where the gap between your expected price and the executed price (called the spread) is typically negligible.
Use a limit order when you have a specific entry point in mind, or when trading less liquid stocks where the spread can be wide. Limit orders also protect you during fast-moving markets where a price can swing sharply in seconds, your order will not execute at a price worse than your limit.
Slippage: the gap between expected and actual price
Slippage is the difference between the price you saw when placing the order and the price at which it actually executed. It happens because markets move in real time and there is always a small delay between your action and the execution.
For the large, liquid US stocks and ETFs available on Amarah, slippage is typically a fraction of a cent, negligible. During high-volatility moments (a major earnings miss, a surprise news event), slippage can be more significant, which is when limit orders offer the most protection.
How it works on Amarah
Amarah uses market orders by default: appropriate for the US large-cap stocks and ETFs on the platform, which are among the most liquid assets in the world. When you tap Buy and confirm, a market order reaches our US broker partner and typically executes within seconds during market hours (2:30 PM to 9:00 PM WAT for most of the year, 3:30 PM to 10:00 PM in winter, Monday to Friday).
As the platform evolves, limit order support will be added for users who want more precise price control.
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