Order execution and order matching types are terms that frequently appear on stock exchanges. So what is order matching? Let’s learn about this term and related types of stock orders through the last article LADIGI!

What is order matching

?Order matching is the successful implementation of an agreement between two parties buying and selling on an online transaction price list. During the transaction, the orders of the investors are arranged according to the principle of order matching priority of the stock market at the most suitable price.

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What is the basic principle of order matching

?After understanding what is the concept of order matching, you need to understand the following two basic principles of priority:

Price priority: Buy orders and sell orders will be prioritized for execution at higher and lower prices respectively. Time priority: Orders entered into the trading system first will be executed first. if these orders have the same price

What is order matching? There are 2 basic principles of priority for order matching as follows: price priority and time priority

Types of stock trading orders

To be able to understand terms like LO, ATO, ATC, MP, PLO, what are the conditions, we first need to clarify the two concepts of periodic order matching and continuous order matching.

Periodic order matching is a method of trading at a time to determine the entire set of buy and sell orders for securities and find a price with the largest trading volume. This type of order matching is used to determine the opening and closing prices on stock exchanges.

Continuous order matching is a continuous trading method that is executed as soon as an order is entered into the trading system based on the matching of securities trading orders.

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LO command

LO is an abbreviation of Limit Order in securities, LO order is most easily defined as an order to limit buying and selling securities at a specified price or possibly at a better price. LO orders have priority after ATC and ATO orders in periodic order matching sessions and after MP orders in continuous order matching sessions.

The LO order is applied to stocks listed on three exchanges, namely HNX, UPCOM, HOUSE and can also be used in other trading sessions.

The validity of the LO order is calculated from the time the order is entered into the trading system until the order is canceled (or when the trading period expires).

ATO Order

ATO is an abbreviation of At The Open in securities, ATO order is understood as a periodic order to buy and sell at the opening price, that is, this order will be traded at the lowest and highest price respectively. Therefore, it is prioritized to match before the LO instruction.

The volume of ATO orders is fixed with the price changing and the opening price will have the largest matching volume.

The validity of the ATO order will be calculated during the opening time of the periodic order matching session, which opens at 9-9:15 am for the purpose of determining the opening price until the order expires (in two cases when the order is not matched). or not at all).

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ATC command

ATC is an abbreviation of At The Close in securities, similar to ATO order but ATC order is an order to buy and sell at the closing price, applied to stocks listed on HNX and HOSE.

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The validity of ATC orders will be calculated during the periodic order matching session which closes at 2:30-2:45.

MP Command

MP order is an abbreviation of market order in securities, which is an order to buy or sell a security at the lowest or highest price respectively in the market.

MP orders are used in continuous order matching transactions and at the moment this order has not been applied on the stock market in Vietnam.

Note:

MP orders that have volume but cannot be matched anymore will be converted to LO limit orders at the buying or selling price that is higher or lower respectively than the previous last trading level. MP orders of foreign investors The outside price will be canceled after partial matching but the remaining room is exhausted.Execution price with the last MP order is the ceiling price or the floor price will be converted into a LO order to buy at the ceiling price or floor price.

Conditions

A conditional order is simply understood as a limit order that is maintained while waiting for the order to be matched or the customer places an order that has not yet been executed.

Limit order retention validity is calculated on the trading day and is automatically posted on the exchange when:

The order is partially filled and the rest is still valid. The stock price is within the ceiling and floor of the day. Meeting the conditions of volume, purchasing power,

PLO command

PLO order is an abbreviation of Post Limit Order, PLO is understood as a limit order to buy and sell securities after the closing of the periodic order matching session.

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Note:

In the trading session after the time when a new PLO order is entered into the system, the order will be executed immediately after that if there is a reciprocal order waiting on the system with the transaction price being the closing price. The PLO order cannot be modified or cancelled. will not be entered into the system if the order execution price cannot be determined within continuous order matching session or periodic order matching session is closed.

Negotiable transaction

Negotiable transactions are transactions where investors or members agree with each other on price and volume. The agreed price must be within the price fluctuation range at the trading day.

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Above is the article What is Order Matching? Types of stock orders to trade LO, ATO, ATC, MP, PLO, what are the conditions? LADIGI hopes to provide a useful amount of information for those of you who are looking to learn and intend to invest in securities. Good luck.

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