Which type of order is used to buy or sell at the current market price?

A market order is utilized when an investor wants to buy or sell a security at the current market price. This type of order ensures that the transaction occurs at the best available price in the market at that moment. When a market order is placed, it is executed immediately, prioritizing speed of execution over price. This type of order is particularly effective when the investor values quick transactions and is willing to accept the price fluctuations that may occur at that instant.

In contrast, a limit order specifies a particular price at which the investor is willing to buy or sell. This order will only be executed if the market reaches that specified price, which may lead to delays in execution if the limit price is not met. A stop order, on the other hand, is designed to trigger a market order once a certain price threshold is reached and is often used to limit losses or protect profits. Finally, a good-til-cancelled order remains active until the investor chooses to cancel it, allowing for more flexibility compared to typical market or limit orders. However, it does not guarantee execution at current market prices, unlike a market order.