UK Accounting Glossary
A buy order is an order to buy a stock or other asset. It is used to add long positions or cover short positions. Buy orders are submitted to a broker, who first attempts to match it against any outstanding buy orders from its own customers. If the buy order can’t be filled internally, it is routed to the appropriate exchange. If the broker is not a member of the exchange, the buy order will be executed by an exchange specialist or market maker. Buy orders are normally initiated by the individual responsible for the trading account. In situations where margin requirements are not being met, a broker may initiate a buy order to cover a short position without first consulting the account holder.
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This glossary post was last updated: 4th February 2020.