Every order placed in a market needs instructions not just on price and quantity, but also on how long the order should remain valid. This is where order duration comes in. Some traders want their orders filled immediately—or not at all. Others want them to sit in the order book for hours, days, or until a specific condition is met.
Exchanges and brokers offer several duration settings, each tailored to different trading styles. Short-term traders may prefer immediate-or-cancel types, while long-term investors often use good-til-canceled orders that stay open until they’re filled or manually removed. These durations help bridge the gap between trading intentions and market conditions, ensuring orders behave exactly as the trader expects.
Duration settings also play a crucial role during volatile markets. An order left open too long may fill unexpectedly at an undesirable moment, while a short-duration order may miss an opportunity entirely. Understanding order durations helps traders control execution and avoid surprises.
Order duration matters because it gives traders control over how their orders interact with the market. Choosing the wrong duration can lead to missed trades, unintended executions, or increased risk.
Duration determines whether an order stays active long enough to be filled. A Day Order expires at market close, an IOC (Immediate-Or-Cancel) order executes instantly or is removed, and a GTC (Good-Til-Canceled) order stays active until filled or canceled. Duration affects how exposed the order is to changing prices and volatility, shaping both likelihood and quality of execution.
Traders who have a specific price target and are willing to wait often choose GTC. It keeps the order alive across multiple sessions, increasing the chance of eventually getting filled at the desired price. This is common for long-term investors who don’t need immediate execution but want to capture price levels that might only appear briefly.
Short-duration orders like IOC or FOK (Fill-Or-Kill) minimize exposure during volatility. They prevent orders from sitting in the book during unpredictable swings and ensure execution only happens immediately—and only if the conditions are met. This helps traders avoid partial fills, slippage, or unintended trades caused by rapid price movements.
A trader wants to buy a stock only if it briefly dips to $150. They place a GTC limit order at that price. The order remains active for days until the stock finally touches $150 during a morning pullback—filling the order automatically without the trader needing to watch the screen.
