If you are like many investors who chose to manage their own stock portfolios through an online brokerage account, understanding how to enter and get out of a stock trade can mean the difference between a gain and loss. Canceling a stock trade may differ slightly depending on the online trading platform. Once you familiarize yourself with the methods for executing trade orders, canceling a stock trade is just a point and click away using your mouse or computer’s keyboard. Cancel orders lets you change your mind about a stock trade without incurring a penalty.
Log into your online brokerage account. Check the trade order notification. Notices vary among online brokers but the word "Filled" may appear next to completed orders. Unfilled orders show a pending status, which means you still have an opportunity to cancel the order. Another way to check if the broker accepted your order is to check your trading account balance. For example, if your account balance declined by $1,000 after you placed an order to purchase $1,000 worth of shares, this means that the broker filled the order. In this case, it is too late to put in a cancel order request for the $1,000 worth of shares.
Highlight the stock trade you want to cancel by clicking a box next to your open order. Highlighting the open order may also reveal a drop down menu, which gives you other options to amending trade orders.
Click the "Cancel Order" option for the stock trade. The online broker may abbreviate the cancel order option. For example, Scottrade abbreviates the cancel function as "Cxl Order." Alternatively, you have the option of right clicking on the order and selecting "Cancel Order for [Symbol]."
Verify that the broker canceled the stock trade through the broker's trade notification system. Your account balance less the broker's fee should also reflect the cancel order.
- A full-service broker is one that takes your stock trade orders over the telephone and places the trades for you. If you use a full-service broker, contact him immediately to put in a cancel order. You will need the ticker symbol for the stock and whether you want a full or partial cancel order. A partial cancel order keeps the original trade in place but reduces the number of shares you want to buy or sell.
- Trading through a full-service broker is more expensive than trading online and there is no guarantee you'll reach the broker over the telephone in time to cancel the order. On the positive side, a full-service broker provides professional investment advice. In addition, if a full-service broker fails to execute your trade as requested, the broker assumes the responsibility for any loss that may occur as a result.
- The risk of investing in the stock market is loss of your capital. Trading online carries the risk that your order may not go through because of a slow Internet connection or other mechanical failure. Online brokers make you sign a securities brokerage customer agreement stipulating that you do not hold them accountable for losses arising from electronic, equipment, mechanical and operator errors. This means the online broker will not indemnify you against a potential loss if your cancel order did not go through because of a technical error. Having a fast, reliable Internet service provider and a working computer improve the chances of your trades going through on timely basis when you trade online.
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