Day Orders and Good till Canceled Orders

Day orders and good till canceled orders are two order types that you should be familiar with as a trader. They each have their advantages.

A day order is an order that you place either to get in or out of a given security. This order is only good for the first trading day after you place it. So if you place the order on Friday, it is good until the end of Friday, if you place it on Saturday it is good until the end of Monday.

The big Disadvantage to day Orders is that you will have to keep placing the order if it is not filled. So if you place a $50 stop on your stock and do not get filled you will have to place it again, every day. The exception is market orders, market orders always get filled.

If you place a good till canceled order on a stock however, you are able to keep an order online, at least until you cancel the order. The order could be running for a day, a week or even a year and would still be good until you cancel it.

So What order type is for you?

That depends, if you plan on readjusting your stops every day you might want to use a day order. If you plan on just buying a stock and saying it will either hit my target or my stop, then a good till canceled order is better because you will not have to place the order every day. Just remember to cancel it once you’re out of the position.

GTO orders also work nicely if you are using a trailing stop that automatically follows the stock up. For instance, you can place a trailing stop that automatically stays 10% below the last high of the stock. And if it is a GTO order you don’t have to monitor it. You simply sit back and wait for your order to get filled.

Day orders are good if you want to just get into a stock or if you want to manually adjust your stop level every day.