A held order is a type of buy or sell order in which execution is immediate and the entire order is filled without delay. It is given to a broker and they are instructed to execute the order as soon as possible. The held order is not a market order, and is instead typically a limit order, although it could be a stop-loss order.
The main benefit of a held order is that it ensures that the customer will be able to complete the entirety of their order without any delay. By giving the broker instructions to immediately execute the order, the customer can be sure that the order will be filled. This can be vital in certain situations such as when trying to complete a short sale, or a trade with a set price target such as with a bracket order.
The opposite of a held order is a not-held order. Here, the broker is given some discretion to wait for a better price or time to execute the order. This becomes particularly important in very volatile markets, where the price of a security can move rapidly and finding the optimal time and price at which to enter or exit a trade can be critical. The downside of a not-held order is that the customer relinquishes some control over the execution of the order to the broker.
In conclusion, a held order is a very useful tool for traders who need to complete orders in a timely fashion, even when market conditions are not ideal. By giving the broker instruction to immediately complete the order, the customer is sure to have the whole order filled but will lose some ability to find the optimal price. The not-held order has the opposite effect, adding convenient control over the execution of an order, but the customer may have to wait for a better price, or longer for their order to be filled.
The main benefit of a held order is that it ensures that the customer will be able to complete the entirety of their order without any delay. By giving the broker instructions to immediately execute the order, the customer can be sure that the order will be filled. This can be vital in certain situations such as when trying to complete a short sale, or a trade with a set price target such as with a bracket order.
The opposite of a held order is a not-held order. Here, the broker is given some discretion to wait for a better price or time to execute the order. This becomes particularly important in very volatile markets, where the price of a security can move rapidly and finding the optimal time and price at which to enter or exit a trade can be critical. The downside of a not-held order is that the customer relinquishes some control over the execution of the order to the broker.
In conclusion, a held order is a very useful tool for traders who need to complete orders in a timely fashion, even when market conditions are not ideal. By giving the broker instruction to immediately complete the order, the customer is sure to have the whole order filled but will lose some ability to find the optimal price. The not-held order has the opposite effect, adding convenient control over the execution of an order, but the customer may have to wait for a better price, or longer for their order to be filled.