This is not investment advice. The information provided is for educational and informational purposes only and does not constitute a recommendation to buy or sell any financial product.
An OCO order, also called One-Cancels-the-Other, is a pair of exit orders that stay linked on a single position. The pair combines a take-profit limit order with a stop-loss order, and the broker cancels the unfilled order as soon as the filled one is reported. The structure is useful when you want to set both an upside target and a downside cap without staying at the screen.
What an OCO order does
An OCO order attaches two exit orders to the same position: a take-profit limit order and a stop-loss order. The word "one-cancels-the-other" describes the behaviour precisely. When one of the two orders is filled, the broker cancels the other one automatically, which removes the need to watch the position and place the second order by hand.
The order type is useful when you want to lock in a profit target or cap a loss without staying at the screen. The trader decides the price levels before the order is placed, and the order stays active in the market until one of the two levels is reached or until the trader cancels the order manually.
How the order behaves in the market
A long OCO combines a sell limit above the entry with a sell stop below the entry. A short OCO mirrors the structure, with a buy limit below the entry and a buy stop above. The gap between the two prices is the trader's range of acceptance: above the limit the trader wants out for a profit, below the stop the trader wants out for a loss.
Gaps complicate the behaviour. If the price gaps through the stop level, the order fills at the next available price, which is the slippage risk. The same applies to the limit. The trader should know the stop is not a guaranteed execution price, and the limit may not fill if the price does not return to the level.
Step-by-step setup
The first step is to open the position entry ticket. Most platforms have a checkbox or a dropdown labelled "OCO" or "If Done." Selecting the option reveals two price fields. The trader enters the take-profit price in the first field and the stop-loss price in the second.
The next step is to set the time in force. Day orders expire at the close, and good-till-cancelled orders stay active until the trader cancels. The choice depends on the trading horizon: day traders use day orders, and swing traders use GTC.
The third step is to confirm the order. The platform shows both legs and the OCO link on the confirmation screen. The trader should check that the limit and the stop are on the correct sides of the entry and that the OCO link is enabled.
Where the order is supported
The order is standard on most retail platforms that offer advanced order types, including MetaTrader 4 and 5, TradingView, TradeStation, Interactive Brokers' Trader Workstation, and most proprietary platforms from discount brokers. The exact name of the order type varies: TradingView calls it "OCO," MetaTrader splits the order into two separate tickets with a script, and some platforms hide the order behind an "advanced orders" menu.
Mobile platforms often lack native OCO support, because the two-leg structure is more complex to display on a small screen. Traders who want OCO on mobile usually set it up on the desktop platform and monitor the position on the mobile app.
Common mistakes
A frequent mistake is to enter the stop and the limit on the same side of the entry, which creates an order that the broker rejects. Another mistake is to forget to enable the OCO link, which leaves both orders active after one is filled, and the second one closes the position at a different price.
A third mistake is to use the order on illiquid stocks, where both legs are likely to slippage. The order works best on liquid stocks and major indices, and the trader should check the bid-ask spread and the average daily volume before placing the order.
Common questions about OCO orders
Does an OCO order cost extra? Most brokers do not charge extra for OCO, because the order is two standard orders linked by software. The trader pays the regular commission on the filled leg, and the unfilled leg is cancelled for free.
Can I attach an OCO to an existing position? Yes. Most platforms allow the trader to add an OCO exit to a position opened with a market order. The setup is the same as placing the OCO on entry, and the platform shows the position details and the two legs.
What happens if the price gaps through both legs? If the price gaps through both legs, the broker fills the leg that the market reaches first. The OCO cancels the second leg as soon as the first is filled, and the trader has one position closed and one cancelled.
Related resources
Where to start
If you are evaluating OCO orders, the most useful first step is to open a demo account at a broker that supports the order type, and to place a small OCO on a liquid stock to see how the platform handles the two legs. Our broker comparison lists the brokers that support OCO orders and the available order types, which together tell you what the platform looks like before you place the first OCO on a live account.