5.3. Types of Municipals Orders

An order represents the intent to buy or sell. Orders placed on the market are generally divided into two types: price orders and time orders.

• A price order is an order to execute a transaction at a specified price or better.

• A time order is an order to buy or sell by a specified time, after which it is either cancelled or converts to a market order or limit order, depending on its specifications.

Price orders may be categorized as either market orders or limit orders. When an investor places a market order, she is requesting that the stock be bought at the best available price. Thus, no specific price is stated, but it is assumed that a seller will get the highest bid and a buyer will get the lowest offer at the time that the order is executed. Market orders will always be filled.

With a limit order, investors will stipul