Unconditional orders (like market orders) are defined as orders whose conditions for execution are set according to the market conditions that prevail at the time the order is created, and sent. In this sense, the market price when the order is created is defined at the reference price for the system to check if the conditions for execution can still be satisfied when the order reaches and hits the marketplace.

The term unconditional does not mean that the order will be treated and executed at any condition, but rather than the conditions are minimal and aims to immediate execution.

Unconditional orders are immediate or cancel. In case of no execution, the order is immediately canceled on rejection. In case of partial execution, the order on the remaining amount which has not been executed is immediately canceled on rejection. Unconditional orders are subject to immediate execution or rejection when sent, whatever the value of their parameters and provided the margin requirements are met.

The market order is basically the only order that can be defined as unconditional. The market order is created and sent by clicking on an instrument trading quarrel, or by submitting according to the market prevailing at order submission. Clients define the amount desired to be executed at the market price. For the purpose of this section, the market order is assumed to be sent by the trader without slippage control, and that the preferences are not set for applying the default slippage value to all market orders. Therefore, such orders are sent with a hidden slippage constraint whose value depends on the instrument.

The market order can be used to take, remove, decrease or increase an exposure.

Parameters

Amount: The amount of the order is defined by the trader.

Slippage: The slippage control is disabled and the hidden slippage value is set.

Message

The action of sending a market order and according consequences are recorded in the messages log, activity log, trade log and other reporting sections if appropriate; below is an example of a market order executed as it is recorded in the messages log. The indication that the market order is unconditional is the mention @ MKT only, with no further slippage or limit indication. Clients should always check the messaging while sending an order. The proper sequence is made of three lines of confirmation. 1. The creation of the order (Sending order) 2.The acceptance of the order by the server (Order sent) 3.The confirmation of either full or partial execution (FILLED) or rejection of the order (REJECTED). The disruption of the messaging sequence signals a problem occurring in either the order submission or execution process. The messages log dispatches the most recent information up.

12:10:13 Order FILLED at 1.3539 CHF (#37546726 BUY 0.5 mil. EUR/CHF @ MKT) - Position #8862367 
12:10:12 Order sent: BUY 0.5 mil. EUR/CHF @ MKT 
12:10:12 Sending order: BUY 0.5 mil. EUR/CHF @ MKT 

Execution Process

The unconditional market order is sent to the marketplace server for execution. The order at this point may be either, executed in full, executed partially, or rejected. The reason for rejection would be that the price at this time was no longer satisfying the embedded conditions when the market order was sent.

Unconditional does not mean that the market order will be executed at any price condition. Indeed, if it was the case, orders would run the risk of being executed even if the market would be far away from the market the trader saw or traded when he sent the order. As a result, the system embeds a maximum value of negative slippage even on unconditional market orders, where the slippage control is disabled on the trader side. This value depends on the instrument and is applied by the system for every market order, if the slippage control is disabled on the client application side. This is to prevent executions at prices either far away from the price the trader acted on, or at prices away of the general market level.

To avoid risk of multiple executions of a unique order amount, each order is routed to the marketplace one at once. The order cannot be treated simultaneously by several liquidity sources, or counterparties. It is therefore possible that a market order suffers rejection and therefore be canceled while at the same time, another liquidity source comes with a price that would satisfy the conditions of executions for the original order. This is the reason why traders are encouraged to thoroughly monitor the messages log and the market prices simultaneously to be able to send another market order should the first attempt be rejected and canceled, and the market price returning to acceptable levels for the trader.

Margin Requirements

The margin requirements for an unconditional market order are calculated when the order is sent for execution. Should the margin not be sufficient to cover the full execution of the market order, the part of the order not covered by the margin will be rejected and only the amount covered by the margin will be sent for execution.

Whatever the amount of the order is, the check for margin requirements will always allow for the maximum amount possible to execute with a given margin. It means that any execution will be allowed until the use of leverage reaches 100 %. In a situation where the trader inputs, mistakenly or willingly, an order amount larger than the maximum order amount covered by the margin, the part of the order that is covered by the full available margin will be sent for execution, and the account will be fully exposed, i.e. the use of leverage will be at 100%, provided the order is executed.