What is Limit Order?

A common function on trading interfaces, a limit order only buys or sells an asset at a specific price. Traders typically set a buy limit order at a price lower than the current market price in anticipation of a move towards a more favorable buy-in price. In contrast, a trader usually sets a sell limit order higher than the current market price to receive a better sell price. These orders remain unfilled if the asset price does not reach the price dictated by the limit order. By contrast, market orders are always filled at the current trading price.