The Order Book
How stock exchanges match buyers and sellers
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Two Types of Orders
- When you want to buy or sell a stock, you send an order to the exchange. There are two main types:
- Limit orders: You specify both quantity AND price. "Buy 100 shares at $576.40 or better." No guarantee of execution—your order might sit unfilled forever.
- Market orders: You specify only quantity. "Buy 200 shares at whatever price is available." Guaranteed execution, but you don't control the price.
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