Market Execution vs Instant Execution - Which One is Better?

MetaTrader platforms can be configured by Forex brokers as they wish. The trade server whether MT4 or MT5 can be configured by the broker to process trade orders in two methods namely instant execution or market execution. This greatly depends on their decisions. Instant execution, just as the name suggest is designed to execute your orders instantly without market influence. Most MT4 platforms uses instantly execution configuration. In opposite, the design of market execution does not process orders instantly but rather uses the best price offered by the broker when you submit your order. These two types of order execution used on MetaTrader have different advantages and disadvantages as discussed below. Slippage Control These two order execution configurations shows different varying ability to control slippage. Ability to control slippage is one of the most important aspects that every Forex trader is looking for. A trader has high ability to control slippage on the market orders when using instant execution configuration. This is done by specifying maximum tolerated pips deviation either from ask price or bid price. A trade is automatically rejected when MetaTrader cannot execute the order when the specified deviation. With market execution, there is no slippage control and the trade is executed at the next best price offered by the broker. Requote The instant execution configuration sends a requote message whenever a trade is rejected. The trade is rejected whenever the trade server is unable to fill execute the order within the maximum allowed deviation set by the Forex trader. In case of market execution, no requote message is returned and the server proceeds to execute the order at the next best price offered by the broker. The broker can slip the trade even by more than 10 pips since there is nothing that stops it from doing that. Stop Loss And Take Profit Orders Under market execution configuration, a trader is not allowed to use Stop Loss and Take Profit orders. In addition, SL and TP orders cannot be set at the moment when new trades are placed. The market execution only allows traders to add SL and TP orders after the trade is open when the price of the open position is known. On the contrary, the trader is allowed to set SL and TP orders when using instant execution. Unlike under market execution, a trader cannot modify his existing trades when setting new stops and profit targets. Execution Prices Vary The market execution configuration uses varying executed prices. It is a big disadvantage because prices can move against the trader without control. For instant execution, the executed price is exactly what you click hence there is reduced level of risk. Unlike under market execution, the server MetaTrader server does not wait for the price provided by the broker. Conclusion First, it is very important to understand the type of configuration that your broker allows since they have full control of this. Instant configuration is mostly common with MT4 platform. Brokers which are known to use this type of configuration include Alpari micro/classic, Forex.com, FXDD, and Fx Pro, while market execution is used by MB Trading, Go Markets, FXCM, InterbankFx, PFG Best, and Axitrader. Although all of them are reliable, market execution puts you at a greater risk as you are forced to accept everything that you broker offers even if it is a raw deal. Likewise, instant execution is best for all currency pairs and it does not force you to accept quotes that your broker offers if it is different from the market quote.