What is the difference between a market order and limit order?

Modified on Fri, 22 May at 11:39 PM

You can place different types of orders on the Freedx exchange, depending on your trading strategy and goals. Each order type serves a different purpose, from executing trades instantly to controlling entry and exit prices. 

 

 

Market Order 

  • Definition: Executes immediately at the current best available market price. 
  • Use Case: When you need to buy or sell instantly. 
  • Example: 
  • You place a market buy order for 1 BTC at the current asset’s price of $97,000. 
  • The order executes instantly at the current market price. 

 

 

Limit Order 

  • Definition: Sets a specific price at which you want to buy or sell. The order is carried out only if the market reaches your chosen price. 
  • Use Case: To control the price at which you buy or sell. 
  • Example: 
  • You place a limit buy order to purchase 1 BTC at $80,000 
  • The order remains in the order book until the market price drops to $80,000. If it doesn’t, the order will not be fulfilled.  

 

 

Order Type 

Execution Speed 

Control Over Price 

Use Case 

Market Order 

Immediate execution 

No control over price 

Quick trades at current market price 

Limit Order 

Executes when price matches 

Full control over execution price 

Trading at specific desired prices 

 

 

 

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