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Comment by gd1 | Hacker News Reader

>To ban a market order is to tell me I'm not allowed to enter/exit a position in a single order, that's non-sense.

You could carry on trading as you currently are. If a stock is trading $100/$100.1 and you want to buy it ('now' as you say), then just set your limit to $1000.

Of course, you will have no one to blame but yourself if, during the ~50 milliseconds it takes for the order to reach the exchange, the market makers have switched off and you end up crossing a massive spread and buying the only available offer at $600 or something. An incredibly unlikely scenario, but it can happen.

So I imagine you'll set your limit to something sensible, like $101. It'll still get filled 'now' 99.9999% of the time. But you won't be taking the risk of doing something epically stupid. There, that wasn't so hard now was it?

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> So I imagine you'll set your limit to something sensible, like $101. It'll still get filled 'now' 99.9999% of the time. But you won't be taking the risk of doing something epically stupid.

Your scenario doesn't handle the case a market order does, i.e. close my position now. In a fast moving market, using limit orders for stops or exits is just going to result in partial fills or failed orders. If I want out, I want out, I don't only want out if I lose between X and Y, I want out period; that's what market orders are for, for that convenience, you accept slippage as a reality.

> There, that wasn't so hard now was it?

No, it's easy to do things that don't work, I can pump my order into /dev/null, that's easy too, and it's just as useful as a limit order for stops.

>Your scenario doesn't handle the case a market order does, i.e. close my position now.

I covered that. If you really, truly, want to sell at any price(and I can't imagine why, that is terrible trading), then you set your limit to zero.

That's all a market order is - a special case of a marketable limit order (immediate or cancel/fill and kill/etc) with the limit set to zero (in the case of a sell) or infinity (in the case of buy).

Banning vanilla market orders just forces people to acknowledge that fact, which is a good thing.

> I covered that. If you really, truly, want to sell at any price(and I can't imagine why, that is terrible trading), then you set your limit to zero.

Perhaps to avoid a margin call; your imagination is limited, you seem to forget you also have to buy/sell to exit a position when holding on is not an option. Terrible trading is holding on until you get margin called; when your risk management says get out, you get out. A stop loss isn't a stop loss if it can fail to fill or only get partially filled, a market order is exactly what one desires in a stop loss.

> That's all a market order is - a special case of a marketable limit order (immediate or cancel/fill and kill/etc) with the limit set to zero (in the case of a sell) or infinity (in the case of buy).

Yes, and thus no need to ban it.

> Banning vanilla market orders just forces people to acknowledge that fact, which is a good thing.

You can't force people to acknowledge details they don't care to know about. Ban this, ban that; it's all non-sense from people who think they can force the ignorant to learn, you can't. Banning market orders achieves nothing.

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