Time in Force
Candlefocus EditorTime in Force is important, as investments in stocks, options, and other securities rely on market conditions that can rapidly change over time. Most commonly, the Time in Force is set to day order, wherein the broker's service will automatically close the order at the end of the day, immediately-or-cancel (IOC) (which orders the broker to fill all or part of the order at the current price; any unfilled portion of the order is automatically canceled for the investor), fill-or-kill (FOK) (which tells the broker to immediately fill the entire order or cancel it in case only part of the order can be filled at the given time) or good-‘til-canceled (GTC; which tells the broker to keep the order open for sale until it is filled or manually canceled by the investor). All of these orders are requested by the investor, based on their own trading goals and the current market’s conditions.
Past trading orders are also saved by brokers in their database, allowing traders to review their previous transactions if they ever need to. Similarly, if a day order has not been filled before the day ends, the time in force conditions can also be edited to a GTC order, letting the broker know that the investor still wishes to have the order open.
Brokers are required to adhere to the Time in Force requests given by investors, as that is the best way to protect them from unexpected accidental losses in investments. This way, investors can rest assured that their financial investments are adequately protected and secure.