Understanding Order Types: Market vs. Limit

It's surprising how often new traders mess up their entries because they don't grasp the difference between market and limit orders. A market order executes immediately at the best available price, which can be fine for highly liquid assets, but on something gappy or with wider spreads, you might get filled worse than expected. Conversely, a limit order allows you to specify a maximum buy price or minimum sell price, guaranteeing your execution price, but not guaranteeing the order fills at all. For example, trying to buy $COMP at exactly 11.77 with a market order when it's swinging might actually fill you at 11.80 or 11.75 depending on current order book depth and how fast the price is moving; a limit order at 11.77 ensures you don't pay more, but if it only dips to 11.78, you miss the entry entirely.