Order types, execution, and settlement
**Order types:** • **Market order** — executes immediately at the best available price. No price protection. • **Limit order (buy)** — executes at the limit price or lower. • **Limit order (sell)** — executes at the limit price or higher. • **Stop (stop-loss)** — becomes a market order once the stop price is touched (buy stop above market, sell stop below). • **Stop-limit** — becomes a limit order at the stop.
**Time-in-force:** DAY (default), GTC (good till canceled; many venues cap at 60–180 days), IOC, FOK, AON.
**Execution venues:** NYSE, Nasdaq, regional exchanges, ATSs (e.g., ECNs, dark pools), and OTC. Best-execution (FINRA Rule 5310) requires reasonable diligence to obtain the most favorable terms reasonably available.
**Settlement (Rule 15c6-1, T+1 as of May 2024):** regular-way settlement for most equities and corporate/muni debt is one business day after trade date. Cash settlement = same day. Treasury securities settle T+1. Options settle T+1.
**Short selling** is regulated by Reg SHO: • Rule 200 — order marking (buy, sell, sell-short, sell-short-exempt). • Rule 203 — locate requirement before accepting a short order; close-out requirement for fails-to-deliver. • Rule 201 — alternative uptick rule: if a stock drops ≥10% in one day, short sales permitted only at a price above the national best bid for the rest of that day and all of the next.
**Trade reporting:** equity trades report to TRF within 10 seconds (FINRA Rule 6282); corporate debt reports to TRACE within 15 minutes; muni trades to MSRB RTRS within 15 minutes.