Market Order Law and Legal Definition

A market order is an order placed with a broker to buy or sell a stock or security at the current market price. Generally, the broker will enter the order as market order, if there is no specific instruction. In other words, it is an order to buy or sell a stock immediately at the best available current price. A market order is sometimes also referred as “order at the market” or "unrestricted order."

A market order guarantees immediate execution and it often has low commissions or brokerage. The drawback of the market order is the variation in the price when the order is executed and the price obtained from a real-time quote service or the price quoted by the broker. This is an important phenomenon in fast-moving markets where stock prices are more volatile.