What is Immediate or Cancel Order (IOC) in Share Market? | Espresso

What are the Benefits of IOC in Share Market?

If you are a pro in stock market investments, you must know about IOC in the share market. However, for a beginner, it may seem like trading jargon. Nevertheless, no matter what kind of a trader you are, the fact that you are reading this proves that you are interested in knowing the IOC meaning in the share market and what benefits it may have in your trading journey.

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Well, as we all know, the stock market is a volatile place. It has a fast-paced environment, and there are thousands of trading participants every day, at any time, looking for a way to experience gains through trading in stocks, shares, securities, and so on. However, it can get a little difficult for the traders to keep track of the stock prices.
Also Read: How to Invest in Stocks in 5 steps?

So, to simplify the process for yourself, if you are trying to sell or buy different securities, you can put an IOC order. The IOC in the stock market stands for an Immediate or Cancel Order.

IOC in the Share Market – Definition

The IOC meaning in the share market could be a little tough to comprehend for the rookie investors. However, to simplify the same, it can be treated as just another form of an ‘order’ that an investor or a trader can place. If you are a trader in the stock market, you can use IOC to buy or sell securities almost immediately, or else the order will get cancelled, and you will no longer be able to deal in it.

With the IOC order, you will not have to take any action yourself.  It will be a ‘period’ order where you will get to choose the duration of the order to be available in the market. Usually, the IOC in the stock market is often regarded as a ‘zero duration’ order because the time between the order placement and the execution of the same is a few seconds.

The IOC order in the Indian stock market can be set as a market order. This limit order usually specifies that investors can buy or sell securities only once they reach a certain price range. The transaction, however, takes place at the current pricing when the investor places the IOC order or the market order.
Also Read: Indian Stock Market & it's Settlement Process

For instance, if you place an IOC order to buy 100 securities of ABC business, your order will be placed in the stock market immediately. If the order isn’t completed, it will be cancelled. If only 10 stocks of the company are bought, the IOC order for the 90 remaining stocks will stand cancelled.

Why is an IOC Order Beneficial for Investors?

To better understand the IOC order, you need to have a basic understanding of the share market. Once you make up your mind about investing in the stock market, you will need to open a free trading account first. However, the real journey will start when you start investing.

So, once you open an online trading account and Demat account, you can put a buy or sell order. However, there will be no guarantee that your order will be filled.

There could be mismatches between the total number of investors trying to sell or buy a stock. So, when you put a buy order, and there aren’t many sellers out there, you can wait for the IOC order to get completed. This waiting time will result in a huge number of active positions. This could be a little confusing and difficult for you to monitor. Hence, once you put the IOC order, you will not have to worry about keeping a tab on the market fluctuations all the time.

Conclusion

When you use an IOC in the share market properly, it could be efficient for your trading journey. You can execute several IOC instructions without having to keep track of their statuses all the time. So, when you think about opening a trading account or a Demat account for investment, keep the benefits of IOC in mind to gain better profits.
Also Read: How to Buy & Sell Stocks?

Share Market Knowledge Centre

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Frequently Asked Questions

A cancelled order in the stock market is a previously submitted order for buying or selling a stock or security that gets cancelled even before it gets executed on a stock exchange.

An end-of-day order in the stock market is basically a purchase or sell order requested by an investor, which is only open till the end of the day.

An IOC or an Immediate-Or-Cancel (IOC) order is used to sell or purchase stock in the share market that needs to be executed instantly. If a portion of an IOC order isn’t completed immediately, it will be cancelled.