Today before the market opened, I placed a market order for RIO at 47.71. My analysis showed that RIO still had some room to grow and that this was a good price. I was confident in my research and clicked "buy". Market opens, and my stock instantly falls to 45.30, however my computer shows that I have an open order for RIO at 47.71, but no position. I was like "This cant be right, market orders get executed instantly". But just incase, I franticly tried to cancel the order before it could fall even lower (which it did). I couldn't find the cancel button, so I called my broker on speed dial and after a few minutes of talking, he figures out that I had a market order and that market orders cannot be canceled. As soon as I get off the phone, a box pops up and tells me that I just bought RIO at 45.30. I sold as quickly as I could at 45.29. If my order had gone through 47.71 , I would have lost all my gains from the day before and then some in just 2-3 minutes!. luckily I only lost commissions. ---- Lesson learned 1. Market orders cant be canceled 2. NEVER buy before the open 3. NEVER put too much faith in your analysis, no matter how good a set up looks. - nathan
Why is this a "Horror Story"? I cancel Market orders all the time in equities, they can be canceled, generally before 9: 30. Wanna know an old trick, promise not to tell anybody, ok, If you have a market buy in @ the bell, and you wanna cancel, just enter a market sell if you are unable to cancel, just make sure you get it in before the bell. I am sure this is grey area as far as being on both sides of the market, I have more than one account. Happy Trading! PS : How can you have a "market" order with a limit, this is a tall tale!
You're pretty new if this is your horror story. Be prepared for <i>much</i> worse and I am not kidding.
When it comes to markets, I don't think it is a good idea to place an entry order when the market is not open. Exit is a safer bet, but never entry. I believe that that is the main lesson here.