Finance: What are At-the-Close Order and At-the-Opening Order?

What are At-the-Close Orders and At-the-Opening Orders? At-the-Close orders are given to brokers and the brokers can only fill them at the close of market. On the other hand, at-the-opening orders can only be filled right when the market opens. They are made because it’s expected that some substantial change will happen at the end or beginning of the trading day.

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Transcript

00:30

market like 3:59 p.m. New York time or the open of the market like 9:31 a.m. New

00:36

York time got it so why would someone do this kind of limit order well if a [Man discussing limit order]

00:40

company that day before had printed what looked like a really good quarter but

00:45

upon deep inspection the investor who owned the shares thought otherwise and [Man inspecting company folder]

00:50

you know wanted to dump them well then that investor would want to take

00:53

advantage of a high opening print and just sell it whatever the price was a

00:59

minute or two after the open making the bet that the stock would then trade down

01:04

after bigger smarter better analysis was published on the stock itself and then

01:09

everyone else went to dump it - so what about an at the close order well kind

01:14

of inverse of the same thing here a company's quarter will be announced at [4:28pm shown on digital clock]

01:18

4:30 p.m. New York time tons of excitement leading up to it so

01:22

"everyone" wants to be long the stock ahead of earnings but you think

01:27

earnings will disappoint like you know buy the rumor sell the actual news kind

01:33

of vibe so you want to hold the stock until the last minute that day and then

01:38

you just give the guidance to sell the stock that last minute of trading or at [Investor sells stock to market]

01:42

the close and you're out and now we have arrived at the close of this video... Adios! [Man waving on stage]