TOS Order Types

https://www.thinkorswim.com/tos/displayFaq.tos?categoryKey=TRADING

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https://www.thinkorswim.com/tos/displayPage.tos?webpage=servicesOrderTypes

What types of orders does thinkorswim accept?

For all listed products, the thinkorswim software accepts

market
limit
stop
MOC - Market On Close
LOC - Limit On Close
trailing stop (read disclaimer below)
stop limit
conditional
OCO - One Cancels Other (read disclaimer below)

For option spreads, the thinkorswim software accepts

limit
conditional
OCO (read disclaimer below)
market


Through our trade desk, we accept ANY order type imaginable.

All orders, except for option spread orders, are executed electronically. Option spreads are executed via open outcry because none of the five option exchanges currently support electronic spread execution. All trade executions and confirmations will be delivered electronically back to the trading application.

Order Type Explained

LIMIT - default order type for all single option, spread and stock orders. The limit price for buy orders is placed below the current market price. The limit price for sell orders is placed above the current market price. Limit orders will be filled at the limit price or better, but are not guaranteed a fill.

MARKET (also known as "not held") - order used to guarantee an execution, but not guarantee a price or time of execution. The risk of market orders is that you have no control over what the execution price is. We strongly suggest you avoid using them with options, especially option spreads.

STOP (also known as "stop loss") - order used to open or close a position by buying if the market rises or selling if the market falls. The stop price for buy orders is placed above the current market price. The stop price for sell orders is placed below the current market price. A stop order turns into a market order when the stop is triggered, so the final execution price or time of a stop order is not guaranteed. The same risks of market orders apply to stop orders.

In addition to the Standard STOP order which is sent to the exchange, we have created 3 new STOP order types. The "Mark" stop order will be triggered once the Mark or value of the asset reaches or surpasses your stop price. The "Bid" stop order will be triggered once the bid of an asset rises to your stop price or surpasses it (this can be used for a Buy Stop order). The "Ask" stop order will be triggered if the ask price falls to your stop price or surpasses it (this can be used for a Sell Stop order).

STOP LIMIT - order used to open or close a position by buying if the market rises or selling if the market falls, but that turns into a limit order when the stop price is triggered. Stop limit orders have a stop price and a limit price. When the stop price is triggered, the limit order is activated. The stop price for buy orders is placed above the current market price. The stop price for sell orders is placed below the current market price. The stop price does not need to be the same as the limit price. Just as with a limit order, the stop limit order will be filled at the limit price or better, but may not be filled at all.

[Combining Stop and TrailingStop is a good strategy]
TRAILING STOP - stop order that continually adjusts the stop price based on changes in the market price. A trailing stop to sell raises the stop price as the market price increases, but does not lower the stop price when the market price decreases. A trailing stop to buy lowers the stop price as the market price decreases, but does not increase the stop price as the market price increases. In both cases, the stop "trails" the market price. When the stop price is reached, the order becomes a market order. The same risk of market orders applies to trailing stops.

[Combining StopLimit and TrailingStopLimit is a good strategy]
TRAILING STOPLIMIT - this order type works the same way as the trailing stop, only instead of a market order being sent to the exchange, a limit order will be sent to the exchange. With this order, you will be able to stipulate the worst price you are willing to accept for a fill. There is no guarantee that you will be filled, though, as the price may gap through your limit price.

MOC (Market on Close) - order that buys or sells at the market price at the close of trading. You must submit the order by 2:40 pm CT. The same risk of market orders applies to MOC orders.

LOC (Limit on Close) - order that buys or sells at a limit price at the close of trading. You must submit the order by 2:40 pm CT. The order can be filled at the limit price or better, but is not guaranteed a fill.


How do OCO orders work?

OCO orders (one cancels other) are orders that work simultaneously and cause a cancel to be sent when one of them fills. OCO Disclaimer: There is no guarantee that the cancel can be sent in time to prevent the second order from filling, leaving you with executions on both orders. It is especially important not to place an OCO order where both component orders are close to the market.

[Combining Stop (StopLimit) and TrailingStop (TrailingStopLimit) is a good strategy]
Trailing stop disclaimer:

thinkorswim does not recommend trailing stop orders, as there is no guarantee that your order will be filled at or near the designated stop price, which is especially dangerous in rapidly rising or falling markets. In addition, trailing stop orders will accentuate volatility in rough markets.

A trailing stop allows you to specify a limit on the maximum possible loss, without setting a limit on the maximum possible gain. A trailing stop SELL (BUY) order is an order where the stop price is set at some fixed amount away from the asset's bid (ask). If the market price rises (falls), the stop loss price also rises (falls) by this fixed amount. If the stock price falls (rises), the stop price remains the same. When the market moves against the position by the set amount, the stop order is triggered, and is submitted as a market order.

For example, XYZ shows a price of 50.00. A customer puts in a trailing stop order to sell at $1.00 below the current bid. A stop order is entered into the system for $49.00. When the bid price rises to $52.00, the stop order price rises to $51.00. When the bid price drops to $51.50, the stop order price remains at $51.00. When the ask price drops to $51.00, the stop order is triggered and submitted as a market order.

NOTE: The market order resulting from a triggered trailing stop order is not guaranteed to execute at any specific price. A trailing stop sell order becomes a market order when the last traded price is less than or equal to the stop price or if the ask price is less than or equal to the stop price (which is determined by the highest bid price after the tralstop is entered.) Trailing stop sell orders for Nasdaq stocks and US equity options are only triggered after two ask prices are less than or equal to the stop price.

A trailing stop buy order becomes a market order when the last traded price is greater than or equal to the stop price (which is set at a specified differential above the lowest offer). Trailing stop buy orders for Nasdaq stocks and US equity options are only triggered after two bid prices are greater than or equal to the stop price. For US equities markets, stop orders will only be elected by prices posted during normal NYSE trading hours.