Market order — An order to buy or sell immediately at the best price currently available.
How market order works in prop trading
A market order prioritises certainty of execution over price. It takes whatever is resting on the other side, filling through as many levels as your size requires. In a deep book at a liquid hour that means one tick of spread; in a thin one it can mean several.
The right use on a prop account is exits, where being out matters more than the price you got. The wrong use is routine entries in thin conditions, where the accumulated slippage is a real share of a small drawdown allowance. Around scheduled releases a market order is the most expensive instruction you can give.
Key points
- Fills immediately, at whatever price the book provides.
- Cost equals the spread plus any slippage from walking the book at size.
- Appropriate for exits; expensive as a routine entry method.
- The worst possible order type in the seconds around a high-impact release.
Also known as
- market execution
- at market
- aggressive order
Frequently asked questions
Are market orders bad for prop accounts?
Not inherently — they are the right tool when getting out matters. The problem is using them as the default entry in thin markets, where the spread and slippage per trade become a measurable percentage of a drawdown allowance measured in low thousands.
How much does a market order cost?
At minimum the bid-ask spread, which is one tick in liquid index futures. In thin conditions or at size it costs more as the order fills through successive levels of the book.
Market order is described here as a plain-language educational definition. Firms, platforms, and account programs may apply different conditions or calculations. Verify the current official terms before using this definition to make an account decision.