User:Jpslaga/sandbox

Futures Order Guide to Different Types of Futures Orders
== Commodity Futures Market == It is important to remember that like any tradable market the futures market is made up of buyers and sellers. The market is an auction that is determined by supply and demand. Futures contracts are traded on exchanges like the CME Group and ICE exchange. On each exchange there are participants who have contracted with the exchange to provide a two-sided market on a futures contract. A two-sided market is providing a [|bid] and [|ask], thus the market maker is obligated to take a buy or sell. This obligation comes with the opportunity for them to buy on the bid and sell on the ask and hopefully offset their position and make a small profit on the difference between the [|bid-offer spread]. As a futures trader who is not a market-maker you must buy on the offer and sell on the bid. The price where the market last traded is referred to as the "market" price or the "last traded at" price. Because there can be many participants in a market at one time all orders are placed in a queue based on the time they are received.

Different Types of Futures Orders
It should be noted that each exchange may choose to handle orders a bit differently and the purpose of this article is to give you the information in its most general sense. Also the volume of

Market Order
A Market Order is an order that a trader uses to enter a position in the market at the current available market price. How a market order works is that it will enter you with a buy or sell at the current market's bid and offer available at the time your order is matched. As a trader if you are buying then your Buy Market order will be matched with the Ask Price. If you are selling then your Sell Market order will be matched with the Bid Price. Example of a Market Order If the market is currently bid at 100 and offered and 101 and you enter to buy at the market, then you will have bought at a price of 101.