Why it matters
Market orders guarantee execution, not price. In fast markets, that’s dangerous.
Decision use: treat this term as a risk input. If you can’t observe it, you can’t size for it.
Common trap
Using market orders during spikes without sizing for slippage.
Example
You hit buy market during news and get filled far worse than the quote you saw.
Operational cue: if you can’t point to it on the chart, in the DOM, or in your broker logs, treat it as a story and trade smaller.
Notes
Market orders are useful in normal conditions. In abnormal conditions they can be an expensive surprise.
Quick rule
- If you see this repeatedly, you are in a different regime than your model assumes.
- Regime change usually means position size change.
- When in doubt: trade smaller, or don’t trade.