FxPro Help Centre - Glossary

  1. Forex glossary terms and definitions
  2. Good for the Day

Good for the Day

Definition

Good for the Day (GFD) is a term used in financial trading to describe an order type that remains active and executable only for the duration of the trading day it is placed in. When a trader specifies that an order is "good for the day", it means that if the order is not filled by the end of the trading day, it will automatically expire or be canceled.

Role in Trading

Good for the Day orders allow traders to execute trades based on their short-term trading strategies and market conditions within a specific trading session. By setting an order to expire at the end of the trading day, traders can manage their positions more effectively and avoid unexpected executions or price movements that may occur after the close of trading.

Expiration and Renewal

At the end of the trading day, any Good for the Day orders that have not been filled are automatically canceled or expired by the trading platform. If a trader still wishes to execute the order, they must manually renew or re-enter the order for the next trading day. This process ensures that orders are kept relevant to current market conditions and trading objectives.

Limitations and Considerations

While Good for the Day orders offer flexibility and control to traders, they also come with limitations. Traders must be mindful of the expiration time of their orders and ensure that they are set appropriately based on their trading strategies and objectives. Additionally, sudden market movements or changes in market sentiment may affect the execution of GFD orders, leading to missed opportunities or unexpected outcomes.

Conclusion

In conclusion, Good for the Day orders are a common order type used in financial trading to specify that an order is valid only for the duration of the trading day it is placed in. These orders provide traders with flexibility and control over their trading activities within a specific time frame while allowing them to adapt to changing market conditions. Understanding how Good for the Day orders work and when to use them is essential for effective trade management and risk mitigation in the dynamic financial markets.

Other terms in this category

GTD (Good Till Date/Time)

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