Futures trading mechanics
Futures order types: market, limit and stop orders
A market order requests execution now. A limit order sets a price boundary. A stop waits for a trigger, then follows its market or limit instructions.
Market and limit orders: choose the trade-off
The last traded price is not a reservation for your next order. Available buyers and sellers can change before your order reaches the market, and there may not be enough quantity at one price to fill it completely.
| Instruction | What it controls | What can still happen |
|---|---|---|
| Market | Requests immediate execution at available prices. | The fill can differ from the displayed price; complete execution is not guaranteed. |
| Limit | Sets the maximum buy price or minimum sell price. | It can fill at the limit or a better price, partly or not at all. |
Sources: CME: futures order types · NinjaTrader: market, limit and stop instructions
A limit order can execute immediately
Suppose the best ask is 5,000.25. A buy limit at 5,000.50 can trade at 5,000.25 if sellers are still available there when the order arrives. It does not have to wait for a trade at 5,000.50. If the only available ask moves to 5,000.75, that buy limit cannot execute at the higher price.
Likewise, a sell limit below the current bid can be immediately executable. Use a sell stop, rather than a plain sell limit, when the intended instruction is to wait for a downward trigger. These are hypothetical order mechanics, not suggested entry or exit levels.
Sources: CME: futures order types · NinjaTrader: market, limit and stop instructions
A stop trigger is not a fill price
A stop-market instruction becomes a market order after its trigger condition is met. A stop-limit instead activates a limit order, so its stop price and limit price do different jobs. A buy stop is normally above the current market and a sell stop below it; stops can be used for entries as well as exits.
For a hypothetical long position, consider a sell stop-limit with a 4,998.00 trigger and a 4,997.50 limit. Once triggered, it permits a sale at 4,997.50 or higher. If available bids fall to 4,997.00 before execution, it cannot sell there. The order may remain unfilled while the position continues losing value.
Sources: NinjaTrader: market, limit and stop instructions · CME Globex: order types and protection ranges
CME protection ranges can leave quantity working
CME Globex uses market-with-protection and stop-with-protection orders. Their execution range is bounded by an exchange-defined protection price. For a sell stop with protection, subtract the applicable protection points from the trigger; for a buy stop, add them. Any unfilled remainder rests at that protection price as a limit order.
For illustration only, a sell trigger of 4,998.00 with an assumed 2-point protection range produces a 4,996.00 protection price. That range is not a current setting for any named contract. Bids below 4,996.00 cannot fill the order; protection restricts execution prices, not the position's eventual loss.
CME also documents market-limit orders: they execute at the best available price and leave any unfilled balance as a limit order at that price. Confirm which exchange instruction your platform's button sends and which types the product supports.
Sources: CME: protected market and stop order definitions · CME Globex: order types and protection ranges
Choose when the order expires
Time in force is separate from order type. CME's duration choices include the following; check which your platform and connection offer.
- Day: active for the trading day, then expires. The trading-day boundary is not necessarily midnight on your computer.
- GTC, or Good Till Cancel: remains until fully executed, cancelled or the instrument expires.
- GTD, or Good Till Date: remains until fully executed, cancelled, its specified date arrives or the instrument expires.
- FAK, or Fill and Kill: executes available quantity immediately and cancels the rest. If a specified minimum cannot fill, the entire order is cancelled. CME accepts FAK only during the Open market state.
Check fills and remaining quantity
After submission, inspect the order's state, filled quantity, remaining quantity and average fill price. NinjaTrader Desktop lists these separately in its Orders tab. An order for three contracts with two filled and one remaining has not completed; cancelling the remaining contract does not undo the two fills.
Keep the account and contract visible when reviewing orders. At Boxcar, evaluation and simulated-funded accounts use virtual funds, and their orders do not enter live markets. The exchange examples above therefore do not establish how a simulator will fill an order. Live company-capital trading requires Boxcar's express designation and a separate written agreement.
Sources: NinjaTrader Desktop: Orders tab · Boxcar: evaluation, simulated-funded and live stages