Market Order is an order which customers do not specify the price. A Market Order that is entered into the trading system during the Continuous Trading Session will be executed at the current bid/ask price at the time when the order is processed. Upon customers’ confirmation of any Market Order placement, the Bank will submit the buy/sell order to the market by matching it once up to 10 best price queues in the prevailing market and up to a maximum of 10 spreads above/below the nominal price at the time when the order is processed, provided that the order price is not lower than 0.01 of the denominated currency of the relevant stock. Any unfilled quantity of the Market Order resulting from completion of the above procedure will be automatically cancelled at once. After placement of a Market Order, customers are advised to check the order status and execution result. Customers should also be aware that the final execution price may deviate considerably from the nominal price at order placement, especially for illiquid stocks and/or at the beginning of Morning and Afternoon Trading Sessions due to handling of the orders that have been accumulated before the market opens.
Example 1 (for illustration only):
Customer has placed a Market Order to buy 20,000 shares of a stock.
Assume that the prevailing nominal price of that stock is HKD8.00 with a price spread of HKD0.01.
The Bank will calculate the required transaction amount and trading related charges based on the 10 spreads above the nominal price of the stock (i.e. HKD8.10) and the sum will be withheld from the customer’s available investment amount. The Bank will submit the order to the market for matching once up to the 10 best price queues at prices equal to or lower than the nominal price plus 10 spreads (i.e. HKD8.10).
The price queues in the market: