Page 116 - DCOM507_STOCK_MARKET_OPERATIONS

Unit 5: Trading System in Stock Exchange

the limit price is not specified, the trigger price is taken as the limit price for the order. The Notes
stop loss orders are prioritised in the stop loss book with the most likely order to trigger
first and the least likely to trigger last. The priority is same as that of the regular lot book.
The stop loss condition is met under the following circumstances:
(a) Sell Order: A sell order in the stop loss book gets triggered when the last traded price in
the normal market reaches or falls below the trigger price of the order.
(b) Buy Order: A buy order in the stop loss book gets triggered when the last traded price in
the normal market reaches or exceeds the trigger price of the order.

When a stop loss order with IOC condition enters the system, the order is released in the market
after it is triggered. Once triggered, the order scans the counter order book for a suitable match
to result in a trade or else is cancelled by the system.
RETDEBT Order Matching

The rules for matching the RETDEBT orders are similar to the Regular Lot book except that
RETDEBT order matching takes place only for orders in the RETDEBT order book.

Odd Lot Order Matching

Odd Lot matching takes place only for orders in Odd Lot book. There are no partial trades for an
Odd Lot order i.e. each match is an exact match where the quantity of the passive order is equal
to that of the active order.

Auction Matching

All auction orders are entered into the auction order book. The rules for matching of auctions
are similar to that of the regular lot book except for the following points:
(a) Auction order matching takes place at the end of the solicitor period for the auction.
(b) Auction matching takes place only across orders belonging to the same auction.
(c) All auction trades take place at the auction price.

Validation Check

While matching orders, the system performs the validation check, if the participant of any of the
orders is ‘Suspended’; the trade does not go through.

Self Assessment

Fill in the blanks:
9. Market’s orders entered in the pre-open are termed as ......................................
10. The price bands for the securities in the ...................................... Market are the same as those
applicable for the securities in the Normal Market.

Task Go to website www.infosys.com/Oracle/case-studies/.../oracle-istore-order-
management.pdf - and analyze the given case study and interpret it.

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