What is a limit order — and how can it help you save? | finder.com

What is a limit order?

We know that everyone's situation is unique and we aim to help you find the right product for you. We may receive compensation when you visit our partners' sites or are approved for their products. You can read more about how we maintain editorial independence and how we make money here.

Limit orders can help you get a better price on your currency investments.

Know which way the market’s moving? Then you may want to start placing limit orders. These “hedging” tools can help you get better deals on currency trades if you make the right predictions.

What is a limit order?

With a limit order, you set instructions to prevent your transaction — a forex trade or money transfer, for example — from being executed until the market price reaches your specified exchange rate.

Why is a limit order useful?

Maybe you think a currency is overvalued right now. If so, you can place a buy limit order, which means you’ll only buy the currency if it becomes available at a more attractive price.

You’re not only limited to buy limit orders — you can also place a sell limit order. For example, let’s say the dollar-to-yen rate is USD/JPY = 110 — meaning $1 buys 110 yen. If you want to sell the USD/JPY pair (or sell your dollars for yen), you could place a sell limit order at USD/JPY = 111. If the market reaches that exchange rate, your brokerage executes your limit order — and you acquire yen at a better price.

Basically, a limit order allows you to guarantee the price you’ll buy or sell a currency at.

Limit orders: An example

Let’s say the euro-to-dollar currency pair is currently at EUR/USD = 1.1 (meaning 1 euro buys $1.10). You want to buy euros with your dollars, but you want to wait until the euro becomes a bit cheaper.

In this case, you could place a buy limit order at EUR/USD = 1.08. When the market reaches that exchange rate, your brokerage executes your buy limit order, get you euros at a better price.

Compare providers that can help you set up limit orders

I want to send

to

Min. Transfer Amount Transfer Speed Online Transfer Fee Rate Amount Received Description CTA Details
$1 3 - 5 days USD 1.00 20.062 MXN 100,288 Enjoy high maximum transfers into more than 20 currencies while saving up to 90% over local banks. Go to site Show details
$2,000 3 - 5 days USD 0.00 19.993 MXN 99,967 No-limit transfers with competitive exchange rates for 100+ currencies. Go to site Show details
USD 100 3 - 5 days USD 0.00 19.973 MXN 99,866 Transfer money into 20 currencies and schedule regular payments. $5 fee waived for transfers over $5,000. Go to site Show details

Compare up to 4 providers

I want to send

to

Min. Transfer Amount Transfer Speed Online Transfer Fee Rate Amount Received Description CTA Details
USD 1,000 1 day USD 0.00 19.923 MXN 99,616 Exclusive offer: $0 transfer fee
No-limit transfers with competitive exchange rates for 100+ currencies.
Go to site Show details
USD 1 Within an hour USD 3.99 19.803 MXN 98,935 Use promo code FINDER to send your first transfer at no fee to 110+ countries for bank-to-bank deposit, cash pickup or mobile top-up. Go to site Show details
USD 100 3 - 5 days USD 0.00 19.983 MXN 99,917 Transfer money into 20 currencies and schedule regular payments. $5 fee waived for transfers over $5,000. Go to site Show details
USD 1,000 1 day USD 0.00 19.863 MXN 99,315 Exclusive exchange rate discounts
No-maximum limit transfers with competitive exchange rates for 100+ currencies.
Go to site Show details
USD 1 3 - 5 days USD 75.00 20.064 MXN
98,813
Enjoy high maximum transfers into more than 20 currencies while saving up to 90% over local banks. Go to site Show details

Compare up to 4 providers

Are there any drawbacks?

Drawbacks for limit orders often come from missed opportunities. Investors can be wrong about where the market is headed, leading to ill-timed limit orders.

Maybe you think the euro will go down — but what if it keeps going up? If you placed a buy limit order hoping the euro would go down, you may now be kicking yourself for doing so.

What else should I know?

A limit order is different from a stop-loss order. With a limit order, you’re looking for a price that’s better than your target price (whether you’re buying or selling). On the other hand, a stop-loss order prevents executing a transaction at a price that’s worse than your target price.

Frequently asked questions

Was this content helpful to you? No  Yes

Ask an Expert

You are about to post a question on finder.com:

  • Do not enter personal information (eg. surname, phone number, bank details) as your question will be made public
  • finder.com is a financial comparison and information service, not a bank or product provider
  • We cannot provide you with personal advice or recommendations
  • Your answer might already be waiting – check previous questions below to see if yours has already been asked

Finder only provides general advice and factual information, so consider your own circumstances, or seek advice before you decide to act on our content. By submitting a question, you're accepting our Terms and Conditions and Privacy Policy.

US International Money Transfers Offers

Important Information*
HiFX International Money Transfers

Transfer money into 20 currencies and schedule regular payments. $5 fee waived for transfers over $5,000.

WorldRemit International Money Transfers

Use promo code FINDER to send your first transfer at no fee to 110+ countries for bank-to-bank deposit, cash pickup or mobile top-up.

World First Foreign Exchange

Exclusive offer: $0 transfer fee
No-limit transfers with competitive exchange rates for 100+ currencies.

TransferWise International Money Transfers

Enjoy high maximum transfers into more than 20 currencies while saving up to 90% over local banks.

Go to site