An instruction that is attached to an order that will be placed in the market, provided that the price is at a specific level or better (lower for a buy order and higher for a sell order). This type of instruction allows price improvement if any favorable price changes would occur before execution (filling the order). For example, an order to buy 100 shares (of XYZ company) at USD 15 or better would translate into an instruction to buy at USD 15 or lower if possible. For the buy order, this instruction puts a cap on the purchase price, while for a sell order, it places a floor on the selling price.
January 19, 2024