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Limit orders vs market orders
Should I use a market order or a limit order?
Short answer: A market order guarantees execution but not price. A limit order guarantees price but not execution. For anything other than the most liquid large caps during regular hours, use a limit order — the cost of not filling is almost always smaller than the cost of filling badly.
Where market orders quietly cost you
In extended-hours sessions, in stocks under $5, in anything with a wide spread, and in the first minutes after the open when the book is still forming. In all four, the printed last price and the price you actually get can differ substantially.
Stop orders are not protection
A stop order becomes a market order when triggered. In a gap down it executes at the next available price, which can be far below your stop. A stop-limit avoids that but may not fill at all — which in a crash is exactly when you needed it.
Where to do it
Frequently asked questions
Does a limit order cost more?
No. Order type does not usually change commission.
What happens if my limit never fills?
It expires per its time-in-force setting — end of day, or a set date for good-till-cancelled orders.
Reviewed August 2026. Information only — not investment, tax or legal advice.