Market order

What you buy with a market order is certainty that the position will exist. You pay for it in price. The regulators are blunt about the trade. The SEC's investor bulletin on order types defines a market order as an order to buy or sell at the best available price, says it generally executes immediately, then states that the execution price is not guaranteed. It goes further: the last-traded price is not necessarily the price you get, and in fast markets the execution price often deviates from it. The number on your screen is a report of the past, not an offer. You buy at the ask and sell at the bid, so you cross the spread going in and again coming out. The trade begins underwater by definition. ### Slippage is not a fee, it is an absence Slippage happens when there is not enough size resting where you wanted it. Your order eats the best offer, then the next one up, then the next. Nobody is charging you. The orders simply are not there. Which is why it bites hardest exactly where liquidity thins: the seconds around a scheduled release, the open, dead hours. FINRA says a market order generally executes at or near the current bid or ask during normal hours, 9:30 a.m. to 4 p.m. Eastern. "Generally" and "near" are doing real work in that sentence. **The beginner mistake:** market-ordering into the first seconds of a news release, then blaming the broker for the fill. The broker did its job. There was nothing to fill against. Our default is market orders, no pending orders, unless a strategy explicitly calls for one. Not because slippage is harmless, but because we want you executing when your read is confirmed in real time, rather than when a price gets touched by something you never watched happen. The spread is what that costs.