Precautions To Consider While Executing A Market Order

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Below are some points to consider while executing a Market Order: 

No Guarantee of Price: Market orders do not provide a price guarantee. Your order may be executed at a significantly different price than expected, especially during volatile market conditions.

Not Suitable for Illiquid Stocks: Illiquid stocks often lack sufficient buyers or sellers. As a result, placing a market order for such stocks may lead to non-execution or execution at an unfavorable price.

Risk of Margin Shortages: Since market orders are validated using the Last Traded Price (LTP) but executed at the best available price on the exchange, there is a possibility of execution at a higher price. This can lead to margin violations or a debit balance in your trading account.