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1. Basic interview question

What’s the difference between instant execution and market execution?

An instant execution order is one that’s executed at the price on the screen.

When you place an instant execution order, the terminal sends the request to buy or sell at the current price on the screen.

If the price is still available in the market, your broker will execute the trade.

If not, there will be a “”re-quote”” where your broker return a new two-way price at which you can resubmit the order or have the option to cancel it.

A market execution order is one that’s executed at the best price available in the market.

There are no re-quotes, but the price will not necessary be the one you saw on the screen when you placed the order.

The price the order is filled at may sometimes differ from the price seen on the platform because:

  • the price may have moved from the last market snapshot;
  • or the trade volume you requested may be larger than the volume available in the market at the best trad-able bid/offer (ask) price shown on the screen.

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