Dear WEEXer,
What do GTC, FOK, and IOC mean?
You can choose from different time-in-force options when placing a limit order or trigger limit order. These options allow you to set the validity and the execution method of the order. Time-in-force options allow traders to have more control over their trading strategies.
WEEX offers three different time-in-force options for limit orders.
Good Till Cancelled (GTC): The order will remain in effect until fully executed or manually canceled by the trader. A GTC order is suitable for traders who are willing to wait for all contracts to be filled at a specified price and have the flexibility to cancel the unfilled part at any time.
Fill or Kill (FOK): The order must be fully executed at the specified price or better, otherwise it will be completely canceled. Partial fills are not allowed. This execution strategy is commonly used by scalpers (traders who seek to enter and exit positions in minutes) or day traders seeking short-term market opportunities.
Immediate or Cancel (IOC): The order must be filled immediately at the order limit price or better. If the order cannot be filled immediately, the unfilled futures contracts will be canceled. IOC orders are normally used to prevent large orders from being executed at prices that deviate from the ideal price. With this setting, the contracts that cannot be executed at the specified price will be canceled.
Example:
A trader wants to buy 10,000 futures contracts immediately, and the execution price must not go over $8001. The current market situation would look like the following table:
Market data
Comparison of time-in-force options
- If the trader uses GTC to execute the order, 5000 futures contracts will be executed immediately while the remaining 5000 futures contracts will enter the order book and wait in the queue, as shown in the figure above.
- If the trader uses FOK to execute the order, no futures contract will be executed and the order will be canceled because there are currently less than 10,000 futures contracts available in the order book.
- If the trader uses IOC to execute the order, 5000 futures contracts will be filled at $8001, and the remaining unfilled orders will be canceled.
The WEEX Team
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