Basic Order Types

[Estimated reading time: 5 minutes]

1. Limit orders

A limit order lets you buy or sell a custom amount at a specified price or better.Once placed, the order is added to the order book and matched with available orders at the specified price or better.

For example, if the current market price is $100 and you place a limit buy order at $90, the order will only be filled when the market price falls to $90 or lower. It will not be filled above $90. If you place a buy order at $110, the limit price is already above the current price, so the order will be filled at around $100 rather than $110, ensuring a better purchase price.

 

2. Advanced limit orders

Standard limit orders are good-till-canceled (GTC) by default.Advanced limit orders offer three order options: post-only, fill or kill (FOK), and immediate or cancel (IOC).

Post-only

A post-only order won't be filled immediately as a taker order, so you always act as a maker.If the order would immediately match an existing order, it's canceled automatically.

For example, if the best ask is $100 and you place a post-only buy order at $99, the order will be added to the order book because it will not immediately match an existing sell order. If you instead place the post-only buy order at $100 or higher, it will be automatically canceled because it would immediately match the best ask, ensuring that you always trade as a maker.

IOC

An immediate or cancel order must be filled immediately.Any unfilled portion of the order is canceled.

For example, if the best ask is $101 with an available quantity of 10, placing an IOC buy order for 30 at $101 will immediately fill 10. The remaining unfilled quantity of 20 will be canceled rather than added to the order book.

FOK

A fill or kill order must be filled in full immediately. Otherwise, the entire order is canceled.

For example, if the best ask is $101 with an available quantity of 10, an FOK buy order for 10 at $101 will be filled in full. However, if the order quantity is 30, the entire order will be canceled because it cannot be filled in full immediately. No partial fill will occur.

 

3. Market orders

A market order lets you quickly buy or sell at the best currently available prices in the order book without specifying a price. Market orders execute immediately after being placed and do not remain in the order book, so you will always be a taker.

Because market orders are filled level by level at the best available prices, the actual average filled price may differ from the price shown before you placed the order if market depth is insufficient. This is called slippage. The average filled price of a market buy order may be slightly higher than the price shown before placing the order, while that of a market sell order may be slightly lower.Market orders suit situations where execution speed is the priority and an exact price isn't required.

For example, if the current market price is $100 and you place a market buy order, it will consume liquidity at the best ask, second-best ask, and subsequent price levels until fully filled. The average filled price may be slightly higher than $100, but the order does not need to wait in the order book, allowing you to enter the market as quickly as possible.

 

4. Large order splitting

Submitting a large market order all at once may consume substantial market depth across multiple price levels, resulting in significant slippage.To prevent this, the system automatically splits large market orders that far exceed the current order book depth into multiple smaller suborders. These suborders are submitted sequentially over time to avoid an immediate impact on the market price.

Each suborder remains a market order and sequentially consumes liquidity at each price level until the total quantity is fully filled. The overall average filled price will still fluctuate with market depth, but splitting the order can effectively reduce overall slippage compared with submitting the full quantity as a single order.

For example, placing a market buy order for 100 BTC when order book depth is insufficient could quickly drive up the execution price across multiple price levels.The system may automatically split it into five suborders of 20 BTC each and submit them sequentially. This avoids consuming a large amount of liquidity at once and pushing up the price, which reduces slippage in the overall average filled price.

 

5. Reduce-only orders

Reduce-only orders are available for futures trading and can only reduce an existing position without opening a new one.If the actual closable quantity is smaller than the order quantity, the system fills the order based on the actual closable quantity. Any quantity exceeding the position size won't create a position in the opposite direction.

This order type is commonly used to close positions. It helps prevent unintended position increases caused by input errors or rapid market rebounds, giving you more control when closing positions.It's available only in one-way mode.

For example, if you currently hold a 5 BTC long position and place a reduce-only sell order for 8 BTC, only 5 BTC will be filled to close the existing position because the closable quantity (5 BTC) is smaller than the order quantity. The remaining 3 BTC will not open a short position.