There are two main types of order execution:
Each of these types has its peculiarities and is appropriate for certain trading strategies. Amateur traders can mistakenly assume that the key difference between these types is the speed of execution. But the names of these types have nothing to do with the speed; they are diverse mechanisms for carrying out trading operations.
The market execution term is self-explanatory. The deals are executed based on the market itself, precisely on the market price that is fixed at a certain period of time. In other words, after a broker receives an order, it executes it anyway with no regard to the price movement that can be either upward or downward. Naturally, brokers tend to close a deal at the most beneficial price, but some slippages may occur when the actual price differs from the expected one. Usually, it happens during the period of higher volatility.
The instant execution type ensures that orders are executed instantly. What is important here is that traders can enter the market at the preset fixed price. Moreover, the deals are conducted at the price that is determined in the order, i.e. the price is fixed at the moment when traders click the BUY or SELL buttons. Otherwise, if the market price does not match the preset price, then the order is canceled and a trader sees a message about a change in quotes.
To get a clear understanding of what order execution type can suit you best, let us provide the pros and cons of both types.
To sum up, you need to weigh up the pros and cons of these two types of order execution and choose the one that suits your trading goals, strategy, and experience level. The instant execution is appropriate for newbies while seasoned traders who have a clear understanding of the benefits and risks of trading in the currency market are better to work with the market execution type.