What is a Limit Order in Trading?

A limit order is an instruction to buy or sell an asset at a specified price or a more favourable price. It gives greater control over the execution price but does not guarantee that the order will be executed. For a better understanding, let’s study an example:

• Suppose a stock is trading at ₹500.
• A trader wants to buy it only at ₹490 or lower. 
• Now, a buy limit order can be placed at ₹490. 
• The order will execute only if a sufficient quantity becomes available at ₹490 or a lower price.

However, for a “sell order”, the logic is reversed. A sell limit order at ₹510 will execute at ₹510 or higher. 

How to Place a Limit Order?

The general process for how to place a limit order is as follows:

1. Select the asset to trade.
2. Choose Buy or Sell.
3. Select “Limit Order” as the order type.
4. Enter the desired limit price.
5. Enter the quantity.
6. Review the order details and submit them.

Note that the order remains “pending” until the specified price condition is met, unless it is cancelled or expires according to the applicable order validity.

Analyse Prices and Place Limit Orders With Trade246

Place different types of trading orders on Trade246. Access multiple market segments and use advanced TradingView charts, 100+ technical indicators, and professional drawing tools. 

Our platform also supports ultra-low-latency order execution and maintains a 99.9% uptime. Join the 50,000+ active traders today! Register and start trading with a minimum deposit of only ₹1,000.