The Reserved Order — Placing an Order in Advance Before the Market Opens
It is hard to place orders in the middle of the night or during work hours. Setting one up in advance to say 'submit this order when the market opens tomorrow morning' is a reserved order.
What a Reserved Order Is
A reserved order is a feature in which, once the investor presets the stock, quantity, price, and type in advance, the brokerage system automatically 'submits' the order at a designated time or at the open of the next trading day.
Most Korean HTS and MTS (home and mobile trading systems) offer it, and the key is that you can prepare an order during hours when the market is not open.
A point to note is that 'submission' and 'execution' are different. A reserved order only submits the order at the set time; whether it actually executes depends on the market conditions at that moment.
How to Use It
Reserved orders are typically used as follows.
1. Prepare a buy or sell order in advance after the close or overnight. 2. Have it automatically submitted at the opening price of the next trading day. 3. Set it as a limit order so execution is attempted only under your desired price condition.
It eases the problem of not being able to sit at the screen during market hours, for busy office workers or overseas-stock investors dealing with time-zone differences.
Limits and Risks
Reserved orders also have clear limits.
- A limit reserved order may not execute even if submitted, if the opening price falls outside the condition. - A market reserved order may execute at an unwanted price if the opening price gaps far from what you expected. - Even if bad or good news breaks while the order is reserved, it does not automatically change the conditions, so you may need to cancel or amend before submission.
A reserved order is a convenience feature that 'automates the timing of order submission'; it is not a feature that guarantees a good price or execution.
The name, submission method, and available times of reserved orders differ by brokerage. Also, an institution's 'reserve (iceberg)' order means 'a large order that exposes only part of its volume' — a different concept, so do not confuse the two. This article does not recommend any specific trading timing.
Preguntas frecuentes
Q. If I place a reserved order, will it definitely execute?
No. A reserved order only 'submits' the order at the set time. If it is a limit order, the conditions must match to execute, and if the opening price gaps significantly, it may not execute even when submitted, or may execute at a different price than expected.
Q. Are a reserved order and an iceberg (reserve) order the same thing?
They are different. The reserved order in this article means 'automatic submission at a set time,' while an iceberg (reserve) order is an institutional order method that 'exposes only part of a large order in the order book and hides the rest.'
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