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The core order types are market orders, which execute immediately at the current price, and pending orders, which trigger only when the price reaches a level you set. Pending orders include limit orders and stop orders. On top of these, risk-management orders such as stop-loss, take-profit and trailing stop attach to a position to close it automatically. Together they let you control both entry and exit.

A market order buys or sells straight away at the best available price, prioritising speed of execution. A limit order sets a specific price that is better than the current market, and only executes if the market reaches it, prioritising price over certainty. For example, a buy limit is placed below the current price to enter cheaper, while a market order simply fills now.

A stop-loss is an order that automatically closes your position once the price moves against you to a level you choose, capping your loss on that trade. It is a fundamental risk-management tool that enforces discipline and removes emotion from exiting a losing trade. In fast-moving or gapping markets a stop-loss may fill at a slightly worse price than the exact level set, known as slippage.

A take-profit is an order that automatically closes a position once it reaches a target profit level you set in advance. It locks in gains without you needing to watch the market constantly, and prevents a winning trade from reversing before you exit. Traders often set a take-profit alongside a stop-loss when opening a position to define their reward and risk from the outset.

A trailing stop is a stop-loss that follows the price by a set distance as the trade moves in your favour, but stays put if the price reverses. This lets you lock in profit automatically as a trend runs, while still protecting against a turnaround. If the market pulls back by your chosen distance, the trailing stop triggers and closes the position, securing the gains built up.

Both are pending orders, but they trigger in opposite directions. A limit order executes at a price better than the current market, for example buying below or selling above the current price. A stop order executes at a price worse than the current market, often used to enter on a breakout or to exit a losing position. Limit orders seek a better entry; stop orders react to momentum.