Day order definition
A day order is a limit or stop order given to a broker to execute a trade at a specific price before the markets close that day. If the price is not reached before the markets close, the order is cancelled. A day order is the most common of the several types of limit orders. Other limit orders include good ‘til cancelled (GtC) and fill or kill (FoK) orders.
When should you use a good for day order?
Traders tend to use good for day orders when entering positions. This order type is particularly useful for intraday traders who buy and sell multiple securities in a single day.
You may use a good for day order when you’ve analysed the market before open and have an expectation of which securities you’d like to sell and buy throughout the day. Good for day orders release you from needed to monitor a specific security constantly, so you can monitor the entire market at once and make adjustments to your day orders as needed.