How Does the 'Time in Force' Parameter Affect Slippage Risk for a Large Order? ⎊ Path

How Does the ‘Time in Force’ Parameter Affect Slippage Risk for a Large Order?

'Time in Force' (TIF) is an instruction that dictates how long an order remains active before it is canceled. TIF parameters like 'Fill-or-Kill' (FOK) or 'Immediate-or-Cancel' (IOC) demand immediate execution, which, for a large order, can increase slippage by forcing the trade to consume all available liquidity rapidly.

A TIF of 'Good-Til-Canceled' (GTC) allows the order to sit on the book, reducing immediate slippage risk but increasing opportunity cost.

How Can a Trader Use an “Immediate-or-Cancel” (IOC) Order to Limit Exposure during a Flash Crash?

How Does the ‘Peak Size’ Parameter of an Iceberg Order Influence Its Effectiveness?

How Does an ‘Immediate or Cancel’ (IOC) Order Differ from a ‘Fill or Kill’ (FOK) Order?

What Is the Execution Risk Associated with Using a TIF Instruction in an Illiquid Market?

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

How Can a Trader Combine a Stop-Limit with a Time-in-Force Instruction?

How Can a Trader Use a “Good-Til-Canceled” (GTC) Order to Manage a Non-Aggressive Limit Price?

In What Scenario Would a Trader Prefer an FOK Order over an IOC Order?