What is AMO (After Market Order)?
After market order (AMO) is a facility provided to traders and investors to place buy/sell orders after or before normal trading hours.
It is a facility we provide for people who can’t actively track the markets from 9:15 am to 3:30 pm.
AMO refers to the facility using which you can place orders to buy or sell stocks for the next day’s trading before the commencement of trading.
This is useful for people that are unable to watch the market at opening or during the trading session.
Types of After market order (AMO)
The different AMO orders are:
- Limit Orders: Where you determine a price to the buy or sell order should be executed
- Stop-Loss Orders: For buy orders you can specify that the order is executed if the price moves beyond a trigger price and for sale orders you can specify that orders can be executed if price falls below a trigger price.
- Market Orders: A buy or sell order is the order which is executed at the current running price in the market when the order is placed.
When can we place it?
AMO orders maybe during the following time duration –
For Equity share– 3:45 PM to 8:57 AM for NSE, [3:45 PM to 8:59 AM for BSE]
For Currency Market – 3:45 PM to 8:59 AM
For F&O market– 3:45 PM to 9:10 AM
MCX – Anytime during the day, if placed during the market hours the order will go through the next day at 9 AM
After Market Orders are permitted for all products (CNC/MIS/NRML) except for BO/CO
Note: AMOs can be placed at any time in the case of weekends and trading holidays.
When will AMOs send to the exchange?
AMOs will be sent to the exchange at the following mentioned times –
– Equity [NSE & BSE] – Market and Limit orders placed at – 9 AM
– Equity [NSE & BSE] for – Stop loss, IOC validity, SL-M, or Disclosed Quantity (less than 100% of sell) placed- 9:15 AM
– F&O placed- 9:15 AM
– CDS placed- 9:00 AM
Advantage of After market order (AMO)
- You have ample time to make research and take the rational decision
- AMO is for those who wish to participate but they are busy during market hours.
- In post-market hours of trading, one need not actively track the price movements of stock during market hours. You can plan your orders at leisure after doing the research before the market opens the next trading day.
- In today’s digital your presence is not necessary at the exchange to buy or sell the order.
- All platforms: KEAT, KST, websites are ready to avail margin trading facility for AMO orders
- It gives time to research and view various reports that would not have been possible during market hours due to the pressure and rush.
- You can modify or cancel your AMO easily
- You can do the trading through an AMO for commodity also.
- AMO can be placed in the commodity and currency segment also.
- Can plan SIP in individual shares by using the AMO facility.
Disadvantage of After market order (AMO)
- If the value you chose doesn’t match therewith of succeeding day, AMO may not be executed.
- You stand an opportunity to lose potential profit which you’ll have otherwise earned.
How does it work?
Using the After Markets Orders facility is extremely simple. All you need to do is log into your trading account, and choose the AMO option. You can then place your order.
- When you place an AMO, you’ve got to think about the price. Although, you’ve got the flexibleness of selecting a price which is 5% more or less than the price. For example, if the worth of a stock you’re buying is Rs. 100 at the end of the day, you’ve got the choice of selecting a price within the range of Rs. 95 and 105.
- Using the previous example, if it is a buy order and is placed at +/-5% and the share price opens at Rs. 105 on Tuesday then your order will be executed at Rs. 105.