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Question

Difficulty: HardTypes of Orders and Order Execution Strategies

Match each specialized order qualifier or execution instruction with its precise market execution and order handling rule.

  • Immediate-or-Cancel (IOC)Permits immediate partial execution of available shares upon order entry, with any unexecuted remainder canceled immediately.
  • Fill-or-Kill (FOK)Requires immediate execution of the complete quantity in a single fill; if the entire order cannot be filled immediately, it is canceled in full.
  • All-or-None (AON)Requires execution of the entire specified share quantity but does NOT require immediate fill, remaining active as a limit order until filled or expired.
  • Market-on-Close (MOC)Executes as close to the end of the regular trading session as practicable, but must be canceled if a regulatory trading halt occurs before market close.

Answer

Immediate-or-Cancel (IOC) matches with permitting immediate partial execution with any unexecuted remainder canceled. Fill-or-Kill (FOK) matches with requiring immediate execution of the complete quantity in a single fill or complete cancellation. All-or-None (AON) matches with requiring execution of the entire order quantity without requiring immediate execution. Market-on-Close (MOC) matches with executing near the closing session unless a trading halt occurs prior to close.
Each qualifier imposes distinct constraints: Immediate-or-Cancel (IOC) allows immediate partial fills with the remainder canceled; Fill-or-Kill (FOK) requires immediate execution of the full share count or complete cancellation; All-or-None (AON) requires a complete fill but allows the order to wait on the book; Market-on-Close (MOC) targets the closing bell price and cancels if trading is halted before close.

Step-by-Step Solution

1
Analyze time-in-force and execution qualifiers for immediate execution constraints.
Identify that FOK requires immediate fill of 100% of the shares, whereas IOC permits partial immediate fills and cancels the rest.
Both IOC and FOK require action immediately upon entry, but FOK rejects partial fills.
2
Evaluate quantity-fill constraints without immediate time constraints.
Identify that AON requires 100% fill but can rest on the order book as a open order.
AON differs from FOK because AON is not required to be filled immediately.
3
Evaluate specific timing instructions for market closing transactions.
Identify that MOC aims to execute at the market close and is voided if a trading halt prevents execution before the bell.
MOC orders must comply with exchange closing procedures and regulatory halt rules.

Key Concept

Order Qualifiers and Execution Instructions (IOC, FOK, AON, MOC)
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Topics

Types of Orders and Order Execution Strategies