Good evening,as a beginner in stock market,i bought one company shares during this week. I saw the Price at #811 and i initiated my request to buy, but it was sold to me at #815. To be honest with you,i didn’t understand what happened. Please can you explain that in simplest way possible?
Good evening! I'm here to help you understand what happened when you bought shares in the stock market. Let's dive into a simple story to make it easy to grasp:Imagine you are at the market in your village, looking to buy some tomatoes from Mama Ngozi. You see the price tag says ₦100 per basket. ExcRead more
Good evening! I’m here to help you understand what happened when you bought shares in the stock market. Let’s dive into a simple story to make it easy to grasp:
Imagine you are at the market in your village, looking to buy some tomatoes from Mama Ngozi. You see the price tag says ₦100 per basket. Excited about the deal, you ask Mama Ngozi for one basket. However, when you’re about to pay, she tells you that the actual price is ₦105. Confused, you wonder why this happened.
Well, the same thing happened in the stock market when you bought the shares. The price you initially saw (₦811) was like the price tag for the tomatoes. But by the time your request to buy was processed, the actual price had changed slightly to ₦815, similar to Mama Ngozi telling you the final price is ₦105.
This change in price is due to the dynamic nature of the stock market. Prices can fluctuate within seconds based on supply and demand, just like how the price of tomatoes can change if more customers suddenly want to buy them. So, in essence, you ended up paying a bit more than you initially expected because the market price moved before your order was completed.
It’s common in the stock market for prices to vary, so don’t worry too much about this adjustment. Just like in the village market, prices can change based on several factors. Keep observing and learning, and you’ll get the hang of how the stock market works over time.
If you have any more questions or need further clarification, feel free to ask!
See lessThank you for your response, but is it possible to set your buying price target at a particular price and can it be processed? Thank you
Thank you for your response, but is it possible to set your buying price target at a particular price and can it be processed? Thank you
See lessThere are generally two ways you can place a buy order: 1. Market order You're essentially saying: “Buy it for me at the best available price.” If the share is showing ₦811 but the available seller when your order reaches the market is ₦815, you could be filled at ₦815. 2. Limit order You're saying:Read more
There are generally two ways you can place a buy order:
1. Market order
You’re essentially saying:
“Buy it for me at the best available price.”
If the share is showing ₦811 but the available seller when your order reaches the market is ₦815, you could be filled at ₦815.
2. Limit order
You’re saying:
“I want to buy, but I don’t want to pay more than ₦811.”
If you place a limit order at ₦811, your order should not execute above your specified limit.
But there’s a catch:
You may not get the shares at all.
For example:
Your limit: ₦811
Sellers available: ₦815
Your order waits.
If nobody is willing to sell at ₦811 (or lower), you don’t get the shares.
So in your case
You saw:
₦811
You initiated the purchase.
The market found a seller at:
₦815
Your order was executed.
Difference:
₦815 − ₦811 = ₦4 per share
If you bought 100 shares:
₦4 × 100 = ₦400
So your shares cost ₦400 more than if you had actually been able to buy all 100 at ₦811.
This is called slippage in stock market when the execution price differs from the price you expected, although the exact reason can depend on the order type and broker’s execution process.
See lessThank you sir
Thank you sir
See lessHere is a simple answer brother You saw the share at ₦811, but ₦811 was not necessarily the price at which your order was guaranteed to be executed. When you clicked Buy, you were essentially saying: “I want to buy this share.” By the time your order reached the market and matched with a seller, theRead more
Here is a simple answer brother
You saw the share at ₦811, but ₦811 was not necessarily the price at which your order was guaranteed to be executed.
When you clicked Buy, you were essentially saying:
“I want to buy this share.”
By the time your order reached the market and matched with a seller, the available selling price may have moved to ₦815.
So you ended up buying at ₦815.
Think of it like buying tomatoes
See lessYou walk into the market and see:
Seller A: ₦811 per basket
You say, “Let me buy.”
But before your purchase is completed, Seller A’s ₦811 baskets are gone.
The next seller says:
“₦815.”
If your order is allowed to execute at the available market price, you get it at ₦815.
That’s basically what can happen in the stock market.
Thank you sir
Thank you sir
See lessWe are learning together here
We are learning together here
See lessWhat happened to you is completely normal, and almost every investor experiences it when starting out. In trading, this difference between the price you expected and the price you actually paid is called slippage, I experienced that too last week when ngx was rising, I bidded at 179, only to processRead more
What happened to you is completely normal, and almost every investor experiences it when starting out. In trading, this difference between the price you expected and the price you actually paid is called slippage, I experienced that too last week when ngx was rising, I bidded at 179, only to process at #195.6, I lost around #11,000 to this due to the quantity I wanted to buy.
See lessThis usually happens because the price you see on the stock app is not necessarily the price your order will execute at. The most common reasons are: Market price vs. execution price The displayed price may be the last traded price, not the current price available from sellers. Bid–ask spread For exRead more
This usually happens because the price you see on the stock app is not necessarily the price your order will execute at.
See lessThe most common reasons are:
Market price vs. execution price
The displayed price may be the last traded price, not the current price available from sellers.
Bid–ask spread
For example, you might see a stock at ₦100, but sellers may currently be asking ₦102. A market buy order can execute around ₦102.
Market orders
If you selected Market Buy, you’re essentially telling the broker to buy at the best available prices rather than limiting the purchase to a specific price.
Price moved while your order was being processed
In a fast-moving or less-liquid Nigerian stock, the available selling price can change between when you place the order and when it reaches the market.
Multiple sellers at different prices
If you’re buying a relatively large number of shares, the order may consume the cheaper shares first and then execute the remaining shares at higher prices.
Example
You see:
Last price: ₦100
But the order book looks like:
500 shares available at ₦100
1,000 shares at ₦101
2,000 shares at ₦102
If you place a market order for 2,000 shares, you could end up with an average execution price above ₦100.
How to avoid this
If your broker/app supports it, use a limit order.
For example, if you don’t want to pay more than ₦100, you could place:
Buy 2,000 shares @ ₦100 limit
Your order will only execute at ₦100 or lower. The trade-off is that it might not execute at all if nobody is willing to sell at that price.
Thank you
Thank you
See less