NexusFi: Find Your Edge


Home Menu

 





buy market vs buy ask


Discussion in Traders Hideout

Updated
    1. trending_up 35,420 views
    2. thumb_up 6 thanks given
    3. group 2 followers
    1. forum 4 posts
    2. attach_file 0 attachments




 
 

buy market vs buy ask

 
 
adamov's Avatar
 adamov 
Budapest, Hungary
 
Experience: None
Platform: ninjatrader
Trading: FGBL / FESX / ES / ZN / ZB
Posts: 84 since Jun 2012
Thanks Given: 37
Thanks Received: 49

newbie question but can somebody explain what is the difference between buy market and buy ask orders?

Started this thread

Can you help answer these questions
from other members on NexusFi?
Better Renko Gaps
The Elite Circle
NT7 Indicator Script Troubleshooting - Camarilla Pivots
NinjaTrader
Exit Strategy
NinjaTrader
Trade idea based off three indicators.
Traders Hideout
Pivot Indicator like the old SwingTemp by Big Mike
NinjaTrader
 
Best Threads (Most Thanked)
in the last 7 days on NexusFi
Just another trading journal: PA, Wyckoff & Trends
35 thanks
Tao te Trade: way of the WLD
24 thanks
Bigger Wins or Fewer Losses?
19 thanks
GFIs1 1 DAX trade per day journal
16 thanks
Spoo-nalysis ES e-mini futures S&P 500
14 thanks
 
 
josh's Avatar
 josh 
Georgia, US
Legendary Market Wizard
 
Experience: None
Platform: SC
Broker: Denali+Rithmic
Trading: ES, NQ, YM
Posts: 6,234 since Jan 2011
Thanks Given: 6,775
Thanks Received: 18,208



adamov View Post
newbie question but can somebody explain what is the difference between buy market and buy ask orders?

"Buy Market" = buy at the best available price. No guarantees on any specific price. Get me in/out.

"Buy at the ask" = a buy limit is placed at the current ask price. Guarantee is that you will get that price or better. However, if you click too late, the market can run away from you if you are too slow and you will get a bad price.

In super fast or thin markets, often better to place your limit to buy at the actual price you want, and if it's equal to or higher than the lowest ask you will get a fill (at least partial).

Thanked by:
 
 
adamov's Avatar
 adamov 
Budapest, Hungary
 
Experience: None
Platform: ninjatrader
Trading: FGBL / FESX / ES / ZN / ZB
Posts: 84 since Jun 2012
Thanks Given: 37
Thanks Received: 49

thank you @josh!
let me check if I understand it correctly.
the order book is the following:

A 144.59_10
A 144.58_5
A 144.57_3
B 144.56_5
B 144.55_8
B 144.54_12

in this case if I execute a 10 “Buy Market” order
I’ll get 3@57 5@58 and 2@59

If I execute a 10 “Buy at the ask” order
I’ll get 3@57 and the rest of 7 orders won’t be filled and become a standing limit buy order.

I case of buying less than 4 contract I won’t experience any difference neither speed of execution nor anything else.

Is it correct?

Started this thread
Thanked by:
 
 
josh's Avatar
 josh 
Georgia, US
Legendary Market Wizard
 
Experience: None
Platform: SC
Broker: Denali+Rithmic
Trading: ES, NQ, YM
Posts: 6,234 since Jan 2011
Thanks Given: 6,775
Thanks Received: 18,208


adamov View Post
I case of buying less than 4 contract I won’t experience any difference neither speed of execution nor anything else.

Is it correct?

You are exactly correct. The end result would be the same, assuming a static market; the difference in practice of course is that as you press the "buy 3 @ market" or "buy 3 @ ask" buttons, the market can move higher because offers are pulled or taken by someone else. That subsecond delay between when your brain gives your hand the signal to press the button and where the market is when your order arrives may cause a large difference in what you think you are buying and what you get. A guaranteed way to get your price or better is to "buy 3 @ 144.57" -- of course then you might not get a fill if the above scenario occurs and you are left with a resting order to buy.

To be clear, your examples are right on, in the most basic scenario of market mechanics. When you introduce hidden quantity orders, microsecond HFT, and all the other realities of the market, other scenarios are quite likely to occur. For example, your buy 10 at the market is completely filled at 57, meaning there was a refresh offer there, and that he probably has more to sell--not the best scenario to be in.

Thanked by:

 



Last Updated on March 5, 2014


© 2024 NexusFi™, s.a., All Rights Reserved.
Av Ricardo J. Alfaro, Century Tower, Panama City, Panama, Ph: +507 833-9432 (Panama and Intl), +1 888-312-3001 (USA and Canada)
All information is for educational use only and is not investment advice. There is a substantial risk of loss in trading commodity futures, stocks, options and foreign exchange products. Past performance is not indicative of future results.
About Us - Contact Us - Site Rules, Acceptable Use, and Terms and Conditions - Privacy Policy - Downloads - Top
no new posts