Stock Market · Introduction to Stock Markets

Market vs limit vs SL orders

Three order types cover 90% of what you will ever need.

Market order

Executes immediately at whatever the best available price is right now. Guaranteed to fill. But you don't control the exact price. On liquid stocks in normal conditions, the fill is usually within a paisa of the visible price. On illiquid stocks, you might pay ₹5–10 more than expected.

Use when: stock is liquid, you need to get in fast, price is moving quickly.

Limit order

You set a specific price. The order only fills at that price or better. Not guaranteed to fill if the market never reaches your price.

• Buy limit: set below market price (you want to buy cheaper, you wait)
• Sell limit: set above market price (you want to sell higher, you wait)

Use for: almost all normal trading. Gives you full price control.

Stop-Loss order (SL)

Activates when the stock hits a trigger price, then places an order to limit your loss.

• SL-M (Stop Loss Market): triggers at your price, executes at whatever market price is. Guaranteed to execute, not to price.
• SL-L (Stop Loss Limit): triggers at your price, becomes a limit order. May not execute if price gaps past your limit.

> You buy Infosys at ₹1,800. Place SL at ₹1,740. Bad news drops, stock crashes to ₹1,720. Your SL-M fires at ₹1,720. Capping your loss at ~₹80/share instead of ₹80+ with no limit.

AlwaysSet a stop-loss before entering any trade

0Acceptable number of trades without a defined exit

Takeaway. Limit orders for entries. SL orders every single time for exits. Market orders only for liquid stocks when speed matters.