Limit Order

Investing

A limit order is an instruction to buy or sell a security at a specified price or better. Buy limit order: execute only at limit price or lower. Sell limit order: execute only at limit price or higher. Limit orders don't guarantee execution — if price never reaches your limit, the order doesn't fill. Useful for: avoiding bad fills in fast markets, taking profits at target prices, buying dips. Contrast with market orders (execute immediately at best available price, guarantee fill but not price). Modern day traders and long-term investors alike should default to limit orders for any non-emergency trades; market orders in fast markets can cost meaningfully.