Market Order.
In plain English
A market order is an instruction to buy or sell a security immediately at the best price currently available. It almost always fills quickly because it accepts whatever the market is offering, which makes it the simplest order type. The tradeoff is that the price you get can differ from the last quote you saw, especially on stocks that trade in low volume or move fast. For widely traded stocks with tight spreads, that gap is usually tiny.
01Why it matters
Market orders are fast and simple, but on a thinly traded or volatile stock you can pay more or sell for less than the price you saw a second ago.
02The math, step by step
A stock shows $50.20. You place a market order to buy. It fills almost instantly, but because prices move, you might pay $50.22 or $50.18 rather than exactly $50.20.
Illustrative example. The amounts here are hypothetical, chosen to show how the math works, not real quoted rates or figures.
03What this is NOT
A market order is NOT price-controlled. It guarantees the trade happens quickly but not the exact price. A limit order is the reverse: it controls price but may not fill.
Plain-English answers from our glossary. Receipts included. Never advice.
Educational tool. Answers come only from ClearMoneySchool's published glossary and are not advice. Why we never give advice