Orders & ExecutionIOC
Immediate or Cancel (IOC)
An order that executes whatever quantity is immediately available and cancels the remainder.
What Immediate or Cancel (IOC) means
Immediate or cancel requires instant execution but not completeness. Whatever quantity can be filled at the specified price or better is dealt with straight away, and any unfilled balance is cancelled rather than left resting. The result may be a full fill, a partial fill, or nothing at all. This makes IOC the standard instruction for sweeping available liquidity without advertising a resting order that other participants could trade around.
On aggregated forex venues an IOC order is matched against the top of the book from multiple liquidity providers in sequence until either the size is exhausted or the price limit is reached. That is why a single large IOC can produce several fills at different prices, reported as an average. Algorithmic and API-based traders use IOC heavily precisely because it gives deterministic behaviour: the order either becomes a position now or ceases to exist, with no lingering state to manage.
Compared with fill or kill, IOC accepts the risk of an odd residual position in exchange for a much higher chance of doing some business. Compared with an ordinary resting limit order, it gives up the possibility of being filled later in return for never being exposed to adverse selection. Retail platforms expose the choice less often than institutional ones, but most FIX and API interfaces support it directly.
Worked example
An IOC order to sell 10 standard lots of GBP/USD at 1.2699 or better finds 7 lots at that price and nothing more; 7 lots are executed and the remaining 3 are cancelled rather than left working.
Related terms
- Fill or Kill (FOK)An order that must be executed immediately in its entire quantity or be cancelled outright.
- Partial FillExecution of only part of an order's requested quantity, with the balance either resting or cancelled.
- LiquidityThe ease with which an instrument can be traded in size without materially moving its price.
- Order BookThe list of resting buy and sell limit orders at each price level on a trading venue.
- FIX APIThe institutional messaging protocol for quotes and orders, offering low latency and direct routing but demanding setup and volume.
Frequently asked questions
What does Immediate or Cancel (IOC) mean in forex trading?
An order that executes whatever quantity is immediately available and cancels the remainder.
How does Immediate or Cancel (IOC) work in practice?
On aggregated forex venues an IOC order is matched against the top of the book from multiple liquidity providers in sequence until either the size is exhausted or the price limit is reached. That is why a single large IOC can produce several fills at different prices, reported as an average. Algorithmic and API-based traders use IOC heavily precisely because it gives deterministic behaviour: the order either becomes a position now or ceases to exist, with no lingering state to manage.
What is an example of Immediate or Cancel (IOC)?
An IOC order to sell 10 standard lots of GBP/USD at 1.2699 or better finds 7 lots at that price and nothing more; 7 lots are executed and the remaining 3 are cancelled rather than left working.
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