The following is a step-by-step guide on how to place a market or buy order when buying stocks, according to NSE’s format.
You can use a similar procedure if you’re selling stocks as well.
- Sign in to your stock trading platform (Ensure that all fields are completed accurately).
- Look for the ‘Stock’ option on the left-hand navigation bar. If it does not exist, click on ‘Futures Options’.
- Choose an Exchange (Eg. BSE, NSE).
- Now choose the stock to buy (Eg. Tata Motors).
- Just below the name of the stock, you will see a section titled ‘Market’. Select your order type from ‘Price Limit’:
- Enter the number of shares that you would like to buy (Eg. 1), then hit submit or press enter:
- You will now receive a summary of your order like this:
- You may change some information before submitting it e.g if there’s no ‘price per share’, then enter it yourself.
- Once you’re done entering your order, proceed to confirm it:
- After confirming your order and agreeing to the disclaimer, you should see a confirmation page.
- If you’re placing an order after market hours (after trading has ended for the day), then tick the ‘After Market Hours’ box and fill in the details of when you placed your order. Hit submit or press enter. The next screen will give you options on how to pay for your transaction
- Enter all required information & hit continue:
- Now add the bank account details that will be used for receiving payment from the exchange, along with other required information. Finally, generate a one-time payment link, which can be used to make a secure transaction.
Check your bank account for any suspicious transactions after making your payment & then check your balance to verify if the funds have been received or debited accordingly via NEFT/IMPS/RTGS. If you can’t see any pending transactions, you may write into the exchange.
- You can buy your shares as soon as the market opens, so you don’t have to wait till the closing time for stocks to get traded. The prices are usually higher at opening but it’s worth taking this risk in case you really want/need the stock urgently.
- You can get lower commission charges compared to ‘limit’ orders, considering that buying and selling are cheaper than other types of orders (more on this later).
- It gives you an opportunity to place multiple transactions if required, using only one online transaction facility. This makes life easier &69/ saves time since you do not have to register with many websites for performing different transactions.
- It saves you the hassle of doing any mental math since there’s no limit or price difference to worry about when placing orders. You just tell it how much stock you want to buy & the system will take care of everything else for you. Do keep in mind that not all stocks support ‘market’ orders, so please check this before entering an order!
- Depending on how long the stock has been listed for sale, there may not be enough buyers to purchase your shares. If this is the case, you will have to wait till another buyer comes along and purchases your share on his/her own terms (the seller has the right to choose his/her own price).
- You may end up paying more per share due to one or both parties being desperate for a transaction. This is risky since you may cause yourself loss by overpaying for shares.
- Your order might not be fulfilled according to your requirements & wishes. For instance, you just want 100 shares of XYZ but your order will only get filled if another buyer comes along who agrees to purchase at least 200 shares (based on current market rates). Sometimes it may take some time before this happens and until then, the funds are kept in limbo by the exchange. So please remember this disadvantage when placing orders!
Using ‘market’ orders is efficient & economical compared to other types of orders.
However, there are always risks associated with it, hence you should only use ‘market’ order if you need a stock ASAP or else a ‘limit’ order is best for you.