How Does the "Fill or Kill" Order Type Mitigate Slippage Risk for Market Orders? ⎊ Path

How Does the “Fill or Kill” Order Type Mitigate Slippage Risk for Market Orders?

A "Fill or Kill" (FOK) order is a type of time-in-force instruction that requires the entire order to be executed immediately and completely, or it is cancelled. For a market order, FOK ensures that if the full quantity cannot be filled at the desired price or better, no partial execution occurs.

This prevents the order from being partially filled at increasingly worse prices deeper into the order book, thereby mitigating the risk of significant negative slippage.

Why Is the ‘Good-Til-Cancelled’ (GTC) Time-in-Force Not Suitable for Managing Short-Term Slippage?

How Does the Concept of ‘Atomic Swaps’ in Crypto Relate to the FOK Principle?

What Is the Difference between Expected Price, Executed Price, and Market Price in a Trade?

What Is the Main Drawback of Using FOK Orders in Thinly Traded Derivatives Markets?

How Can a Trader Use a “Time in Force” Instruction to Mitigate Volatility-Induced Slippage?

What Is the “Price-Time Priority” Rule in Order Matching and How Does It Deter Front-Running?

Can a Transaction Be Cancelled or Replaced Once It Enters the Mempool?

What Is a “Pro-Rata” Matching System and How Does It Differ from Price-Time Priority?

Glossar

FOK Orders

Execution ⎊ Fill-or-Kill (FOK) orders, within cryptocurrency and derivatives markets, represent a conditional instruction to execute a trade at a specified price, immediately and in its entirety.