Canadian Securities Course (CSC) Level 1 Practice Exam

What is a market order?

1. An order to buy or sell at any available price.

2. An order to buy or sell at the end of the trading day.

3. The best possible price for a stock.

4. An order only applicable to preferred shares.

The correct answer is: The best possible price for a stock.

A market order is an instruction given by an investor to a broker or brokerage firm to buy or sell a security immediately at the current market price. It is designed to be executed quickly at the best available price in the market. This means that the investor is willing to accept the best possible price at the time of execution. Option A is incorrect because it mentions buying or selling at any available price, while a market order aims to execute at the best available price in the market. Option B is incorrect because it specifies buying or selling at the end of the trading day, which is more characteristic of a specific type of order known as a market-on-close order, not a general market order. Option D is incorrect because a market order is not limited to preferred shares; it can be used for any type of security traded on an exchange.