Set 2 — Order Types and Execution

What is a market order?

An order to buy or sell immediately at the best available price.

What is a limit order?

An order to buy or sell only at a specific price or better.

What is a stop order?

An order that becomes active once price reaches a trigger level.

What is a stop-entry order?

A stop order used to enter a trade once price breaks a level.

What is a stop-loss order?

A protective order used to exit a trade if price moves against you.

What is a stop-limit order?

An order that triggers at a stop price but will only fill within a limit price range.

What is an OCO order?

One Cancels the Other; when one linked order fills, the other is canceled.

What is a bracket order?

An entry with an attached stop-loss and take-profit order.

What is the bid?

The highest price a buyer is currently willing to pay.

What is the ask?

The lowest price a seller is currently willing to accept.

What is the spread?

The difference between the bid and the ask.

What does crossing the spread mean?

Using an aggressive order that fills against the opposite side of the market.

What is slippage?

Getting filled at a worse price than expected.

Why can market orders slip badly at the open?

Because volatility and fast price movement can move through available liquidity quickly.

Why might a limit order not fill?

Because price may touch near it without enough liquidity trading at that exact level.

What is partial fill risk?

When only part of your order is filled and the rest remains unfilled.

Why does execution matter even with a good setup?

Because poor fills can worsen risk, reduce reward, or ruin the trade location.

What is liquidity?

How easily orders can be filled without moving the market too much.

Why are ES and MES attractive for intraday traders?

They usually have strong liquidity compared with many other futures markets.

When would a buy stop-entry be used?

To enter long only if price breaks above a key level.

When would a buy limit be used?

To enter long on a pullback to a chosen price.

Why is a stop-loss mandatory in prop-style trading?

It controls downside and helps prevent violating drawdown rules.

What is unrealized PnL?

Profit or loss on an open trade that has not been closed yet.

What is realized PnL?

Profit or loss that has been locked in by closing the trade.

What is a bracketed trade workflow?

Entry first, then attached stop-loss and target, all defined before the trade plays out.