BROWSE

Day Order

What is a 'Day Order'

A day order is an order to buy or sell a security that automatically expires if not executed on the day the order was placed. If it is not filled, it is canceled, and it is not filled if the limit or stop order price was not met during the trading session. It is one of several different order duration types that determines how long the order is in the market before it is canceled.

Explaining 'Day Order'

For example, a good 'til canceled (GTC) order remains active until it is manually canceled, while an immediate or cancel (IOC) order fills all or part of an order immediately and cancels the remaining part of the order.

Use of Day Orders

Day orders are more commonly used by short-term intraday traders. They are typically used by traders to place an order for a security at a specific price point so the trader doesn't have to monitor it for the rest of the day until it is executed, if it is executed at all. Intraday traders usually monitor and trade multiple securities at one time. Prior to the market open, traders analyze each individual security they trade and normally place orders according to their strategies. The trader takes further action as the individual orders are executed over the course of the trading day. For intraday traders, most strategies dictate that positions are exited at or before the market closing. Thus, all orders that were not executed are cancelled. This happens automatically for day orders.

Pitfalls of Day Orders

For the investors or traders who are not professionals and don’t sit in front of a quote monitor screen all day, placing a day order may create a dilemma. For example, if a day limit order is place at the beginning of the trading day and some unforeseen event takes place that may have unfavorable effects on the price of the security, the order may be executed before the investor or trader becomes aware of the situation. The investor or trader may then be stuck with an undesirable losing position in a security. The professionals who are constantly monitoring markets are quick to react and cancel all orders accordingly.


Further Reading


The day of the week effect on stock market volatility
link.springer.com [PDF]
… We also try other lag orders and the basic results remain the same … Box Q statistic of 5.63 (for 10 lags) and 1,579.45 (for 1,602) lead the rejection of the first 10 order and 1,602 order serial correlation … "Day of the Week Effects and Asset Returns." Journal of Business 54: 579-596 …

Trends in park tourism: Economics, finance and managementTrends in park tourism: Economics, finance and management
www.tandfonline.com [PDF]
… We also try other lag orders and the basic results remain the same … Box Q statistic of 5.63 (for 10 lags) and 1,579.45 (for 1,602) lead the rejection of the first 10 order and 1,602 order serial correlation … "Day of the Week Effects and Asset Returns." Journal of Business 54: 579-596 …

Market vs. limit orders: The SuperDOT evidence on order submission strategyMarket vs. limit orders: The SuperDOT evidence on order submission strategy
www.jstor.org [PDF]
… We also try other lag orders and the basic results remain the same … Box Q statistic of 5.63 (for 10 lags) and 1,579.45 (for 1,602) lead the rejection of the first 10 order and 1,602 order serial correlation … "Day of the Week Effects and Asset Returns." Journal of Business 54: 579-596 …

One day in the life of a very common stockOne day in the life of a very common stock
academic.oup.com [PDF]
… We also try other lag orders and the basic results remain the same … Box Q statistic of 5.63 (for 10 lags) and 1,579.45 (for 1,602) lead the rejection of the first 10 order and 1,602 order serial correlation … "Day of the Week Effects and Asset Returns." Journal of Business 54: 579-596 …

A market microstructure explanation of ex-day abnormal returnsA market microstructure explanation of ex-day abnormal returns
www.jstor.org [PDF]
… We also try other lag orders and the basic results remain the same … Box Q statistic of 5.63 (for 10 lags) and 1,579.45 (for 1,602) lead the rejection of the first 10 order and 1,602 order serial correlation … "Day of the Week Effects and Asset Returns." Journal of Business 54: 579-596 …

Day of the week effects and asset returnsDay of the week effects and asset returns
www.jstor.org [PDF]
… We also try other lag orders and the basic results remain the same … Box Q statistic of 5.63 (for 10 lags) and 1,579.45 (for 1,602) lead the rejection of the first 10 order and 1,602 order serial correlation … "Day of the Week Effects and Asset Returns." Journal of Business 54: 579-596 …

Program trading and expiration-day effectsProgram trading and expiration-day effects
www.tandfonline.com [PDF]
… We also try other lag orders and the basic results remain the same … Box Q statistic of 5.63 (for 10 lags) and 1,579.45 (for 1,602) lead the rejection of the first 10 order and 1,602 order serial correlation … "Day of the Week Effects and Asset Returns." Journal of Business 54: 579-596 …

Intra-day and inter-market volatility in foreign exchange ratesIntra-day and inter-market volatility in foreign exchange rates
academic.oup.com [PDF]
… We also try other lag orders and the basic results remain the same … Box Q statistic of 5.63 (for 10 lags) and 1,579.45 (for 1,602) lead the rejection of the first 10 order and 1,602 order serial correlation … "Day of the Week Effects and Asset Returns." Journal of Business 54: 579-596 …



Q&A About Day Order


Why do short-term intraday traders use them?

They use them so they don't have to monitor their positions all through the trading session.

How do you define a system?

A system is made up of multiple components that interact to produce an output or effect. Systems are often defined by their inputs and outputs with respect to other systems.

What is another name for a day order?

Day limit orders are also called ""day only"" and ""day trade only"".

Are markets always good?

No. Markets can be bad.

What is a day order?

A day order is an order to buy or sell a security that automatically expires if not executed on the day the order was placed.

How does a day order differ from other orders?

Day orders are different from other types of orders because they expire at the end of the trading session.

What does it mean for something to emerge ?

Emergence refers to how complex patterns arise out of simpler ones .

Can you give me an example where emergence occurs in nature ?

One example would be how cells form tissues which form organs which form organisms .

Who uses day orders?

Short-term intraday traders use them.

What are some examples of markets?

Some examples include the stock market and the real estate market.

What does it mean for something to be spontaneous ?

Spontaneous means occurring naturally without apparent cause .

How do you define an institution?

An institution is a set of rules and norms that govern behaviour within a given community or society at large. Institutions provide structure and order to human interaction as well as constrain individual choices about actions within those structures (see also self-organization). The term "institution" may refer either to the formal rules themselves (e.g., laws), or to the collective behavior they regulate (e.g., norms). For example, one can speak of the legal institution of marriage, or the marriage institution itself; similarly one can speak about government without necessarily referring only to its laws."".