At Best is nothing more than a set of instructions that forces an order to be executed at only the most desirable price. While they are mostly market orders, sometimes they also require some degree of discretion from the concerned broker.
At Best - What you need to know about it
To begin with, you must know what At Best means in the world of trading. It simply means that an order would not be executed unless it is at the Best possible price. The order itself is not an At Best order, but the attached instruction is called At Best. No matter how you look at it, the function remains the same.
Definition of At Best
At Best is a command appended to an order to complete a transaction as swiftly as feasible and at the highest possible price. At-Best orders are generally market orders, but they may also require the broker to exercise some discretion to best complete the order.
What Is at Best Order and How to Use It?
In an At Best order, a broker is instructed to fill a purchase or trade order at the best possible price available now, as quickly as feasible. Whenever there is a willing party for the entire transaction, these orders ensure completion, but not the price. At-Best orders are helpful for transactions that need to be completed right away, but they can also be beneficial for traders who do not need anything done right away.
To make the most of this order type, you need to be in close coordination with your broker. It is through them that the orders are executed, and as we already mentioned, At Best orders can require some discretion from the broker, though they are market orders in most cases.
Explanation of At Best in Detail?
When there is a counterparty available at the right time and the right place, only then do the at-best orders secure execution, but not the price. Because at-best guidelines do not allow you to establish a price, the actual price at which a buyer may purchase or sell may be greater or lower than intended. As a result, traders should exercise caution when placing orders until they want fast completion no matter what the price.
Examples of the Most Advantageous at Best Orders
Two primary situations suit the nature of At Best orders the most. For a method that demands immediate execution due to time-sensitive information, At Best order makes much sense. For example, if a trader recognizes a good trade idea before anybody else and does not want much competition along the way, they can benefit from At Best orders.
Some long-term investors select certain assets as "At Best" since they are not worried about price or timing and only want to have the asset. A hedge fund, for instance, would want to invest in a long-term bullish asset class but it does not make sense for them to pay more for immediate execution or orders.
As you can see, the two Best situations for At Best orders are also completely different. Their goals are different, and their motivations are completely in the opposite direction. Nonetheless, traders find utility in both use cases and even beyond these two situations.
Conclusion
We hope our guide was able to convey the basic principles and ideas of At Best orders and trading. Now that technology has entered the trading space like never before, it is more important to know about the diverse types of orders and executions. It will help you trade with more confidence and ease.