Investors have multiple options when placing orders on the stock market. Two of the most popular and often-used order types are Fill or Kill (FOK) and Immediate or Cancel (IOC). Understanding how these two orders work can help investors decide when to use them.

FOK orders require that all the shares in an order be filled immediately, without delay. If not, then the entire order will be cancelled. These orders are helpful for investors who need to execute a large block trade quickly, as FOK orders ensure immediate execution of the desired number of shares. They also benefit traders who want to enter trades with minimal price impact, as they allow for price assurance by avoiding partial fills.

On the other hand, IOC orders require that at least part of an order is filled immediately. However, any portion of the order that cannot be executed is cancelled automatically. These orders …