In trading terminology, the term ‘filled’ refers to when an order placed by a trader has been returned as completed. For example, if a trader submits an order to a broker to buy 100 lots of gold at 1728.50, this order would only be completed and therefore classified as filled when the broker has obtained the total 100 lots that the trader requested.
Typically, depending on the order type the transaction will take anything from less than a second to up to a full market session to be executed. The most common order types that can be used to carry out a transaction are:
- Buy stop orders
- Market orders
- stop-loss orders
- limit orders
It is important to understand that if an order or instruction is performed, it does not guarantee that the order will be filled as there are a specific set of criteria that must be met for an order to be filled. These are expiration, volume, trading, and targeted price.
Expiration
The financial instrument has to, first of all, be open to trading.
Volume
There has to be sufficient volume available in the market for the amount of the trade.
Trading
The instruments need to be trading currently.
Targeted price
If the trader or broker is intending to utilize a limit order, the targeted price aimed for has to be reached to execute. This can be from both a buying and selling perspective.
If any of these criteria are not met, then the trade will not be filled. It is also important to note that slow execution times can lead to prices fluctuating between trade execution and fulfillment, resulting in the trade being filled at a different price than that requested. This difference is referred to as [order spillage].
Key takeaways:
- A filled order status implies that the order was completed, whether this is from a buying or selling perspective
- Filled orders can take anything from less than a second to the end of a market day to be completed
- The type of order to be used for a transaction will depend on the desired outcome by the trader
- Orders must meet a specific set of criteria to be filled