Limit Order
An instruction to buy at or below, or sell at or above, a stated price, executing only if the market reaches it.
How it is identified
Test: the order carries a price condition and rests in the book until matched, cancelled or expired
Unit
qualitative
In depth
A limit order guarantees price but not execution, the exact inverse of a market order. Placing one adds liquidity to the book, and it will be filled only after every earlier order at the same price, under price-time priority. The risk is non-execution: a limit buy just below the market may never fill while the stock runs away, which is a real cost that never appears in any statement. A limit order placed far from the market is not protection, it is a lottery ticket that may sit unfilled all day.
Worked example
A limit buy at ₹249.50 sits behind 3,000 shares already resting at the same price. Even when the stock trades at ₹249.50, those 3,000 shares fill first; if only 2,000 trade there before the price lifts, your order does not execute at all.
Illustrative figures, chosen so the arithmetic is easy to follow. Not a live price and not a valuation of any company.
Educational reference only
This entry explains what “Limit Order” means. It is not investment advice and not a recommendation to buy or sell any security. Any numbers above are illustrative, not live prices, and nothing here predicts price direction or rates a stock. Consider your own circumstances and consult a SEBI-registered investment adviser before acting.