A Limit order is an order to buy or sell at a specified price or better. The Limit order ensures that if the order fills, it will not fill at a price less favorable than your limit price, but it does not guarantee a fill.
Note:
The Reference Table to the right provides a general summary of the order type characteristics. The checked features are applicable in some combination, but do not necessarily work in conjunction with all other checked features. For example, if Options and Stocks, US and Non-US, and Smart and Directed are all checked, it does not follow that all US and Non-US Smart and direct-routed stocks support the order type. It may be the case that only Smart-routed US Stocks, direct-routed Non-US stocks and Smart-routed US Options are supported.
Products
Availability
Routing
TWS
Bonds
US Products
Smart
Attribute
CFDs
Non-US Products
Directed
Order Type
EFPs
Time in Force
Forex
Futures
FOPs
Options
Stocks
Warrants
Note that direct-routed, non-marketable limit orders may be rejected if the specified destination does not support them.
XYZ stock has a current Ask price of 34.00 and you want to use a Limit order to buy 100 shares when the market price falls to 33.50.
You create the Limit order as shown above.
Assumptions
Action
BUY
Qty
100
Market Price
34.00
Order Type
LMT
Limit Price
33.50
Order Type In Depth - Limit Buy Order
Step 2 – Order Transmitted, Market Price Begins to Fall
As soon as you transmit your Limit order, the market price of XYZ stock begins to fall.
Assumptions
Market Price
34.00 and falling
Order Type
LMT
Limit Price
33.50
Order Type In Depth - Limit Buy Order
Step 3 – Market Price Falls to Limit Price, Order Filled
The market price of XYZ continues to fall until it touches your Limit Price of 33.50. Your order for 100 shares is filled.
Assumptions
Market Price
33.50
Order Type
LMT
Stop Price
33.50
Order Type In Depth - Limit Sell Order
Step 1 – Enter a Limit Sell Order
You're long 200 shares of XYZ stock at an Average Price of 14.95 (your entry price). You want to make a profit of at least 50.00, so you use a Limit order to sell 200 shares when the market price rises to 15.20.
You create the Limit order as shown above.
Assumptions
Average Price
14.95
Action
SELL
Qty
200
Market Price
15.16
Order Type
LMT
Limit Price
15.20
Order Type In Depth - Limit Sell Order
Step 2 – Market Price Begins to Rise
As soon as your transmit your Limit order, the market price of XYZ stock begins to rise.
Assumptions
Average Price
14.95
Action
SELL
Qty
200
Market Price
15.16 and rising
Order Type
LMT
Limit Price
15.20
Order Type In Depth - Limit Sell Order
Step 3 – Market Price Rises to Limit Price, Order Filled
The market price of XYZ continues to rise until it touches your Limit Price of 15.20. Your order for 200 shares is filled and you've earned a profit of 50.00.
Assumptions
Average Price
14.95
Action
SELL
Qty
200
Market Price
15.20
Order Type
LMT
Limit Price
15.20
Note: Any stock or option symbols displayed are for illustrative purposes only and are not intended to portray a recommendation.
