Instant execution

What is Instant execution in forex and CFD trading

Instant execution is an order fulfillment method where the broker attempts to execute a market order at the exact price displayed to the trader; if that price is unavailable due to market movement, the broker issues a Requote, offering a new price. Instant execution matters for real trading decisions because it gives the trader price control, preventing automatic slippage outside a defined tolerance, but at the cost of execution speed and the risk of the trade being missed entirely if the Requote is rejected or expires. A trader verifies Instant execution by selecting it as the order type on the MetaTrader 4 (MT4) order window and observing whether a pop-up Requote appears when placing a trade during high volatility, rather than the order executing immediately at a different price. For more details, explore our forex glossary.

Key facts about Instant execution

• Model Association: Primarily utilized by Market Maker (B-book) brokers who control the pricing environment and act as the counterparty to client trades.
• Price Guarantee: The key feature of Instant execution is the attempt to guarantee the exact price shown, subject to the price not having moved outside a broker-defined tolerance limit.
• Order Outcome: If the price is still valid, the order executes instantly; if the price is invalid, the broker issues a Requote or rejects the order entirely.
• Requote Mechanism: If the price movement exceeds the allowed deviation, the trader is presented with a Requote, requiring manual acceptance or rejection of the new price.
• Deviation Control: Traders on platforms supporting Instant execution, like MT4, can often set a “Maximum Deviation” in pips to allow for minor slippage and avoid a Requote.
• Execution Risk: The main risk is execution delay and the chance of missing the intended trade due to the time required for the Requote process.
• Latency Impact: The latency between the trader’s terminal and the broker’s server directly affects the probability of receiving a Requote under Instant execution.

How Instant execution works in forex and CFD trading

Instant execution functions as a controlled execution model where the broker intermediates the price to manage execution risk against the client’s position.

The process involves these sequential steps:

1. Order Submission: A trader sends a Buy Market order for EUR/USD at the displayed Ask price of 1.1000.
2. Server Check: The broker’s dealing system receives the order and checks the current market price (Price B) against the price requested (Price A = 1.1000).
3. Price Validity Test: The system calculates the absolute difference: | Price B – Price A |.
4. Execution Decision (No Requote): If the difference is zero or within the trader’s or broker’s set maximum deviation (e.g., 1 pip), the order is executed at Price A or Price B, ensuring high-speed execution.
5. Execution Decision (Requote): If the difference exceeds the deviation limit (e.g., Price B is 1.1003, a 3 pip difference), the trade is rejected, and a Requote is immediately sent back to the trader at Price B.
6. Trader Confirmation: The trader must manually confirm the Requote price (1.1003) to execute the trade.

Example of Instant execution with a real trade

This example shows the impact of Instant execution triggering a Requote during a volatile entry.

• Scenario: A trader attempts to enter a short position on EUR/USD during moderate volatility.
• Intended Entry Type: Sell Market Order (Instant execution) Intended Entry Price (Bid): 1.1000 Position size: 1 standard lot (100,000 units) Broker Max Deviation Setting: 2 pips
• Instant Execution Outcome: Trader clicks Sell at 1.1000. During the 50ms server trip, the Bid price falls to 1.0997. Price difference: 1.1000 – 1.0997 = 3 pips. Since 3 pips > 2 pips deviation limit, the order is rejected at 1.1000. Broker issues a Requote at 1.0997. Trader accepts the Requote within 3 seconds.
• Result: 1 standard lot sold at 1.0997, guaranteeing the price but incurring a delay and missing the original price by 3 pips.

How Instant execution affects your cost and risk

Instant execution protects the trader from large, unexpected negative slippage by forcing a price confirmation, but this protection comes with the risk of non-execution and opportunity cost due to the delay caused by the Requote. The execution cost (spread) itself remains unchanged.

Instant execution compared with related concepts

Instant execution vs Market execution

Instant execution prioritizes the requested price and uses a Requote when the price changes beyond a set tolerance, creating a potential delay. Market execution prioritizes immediate execution and will automatically accept the best available price (slippage) without issuing a Requote. Instant execution seeks price certainty; Market execution seeks speed certainty.

Instant execution vs Pending Order

Instant execution is used for immediate market entry and requires instant acceptance or rejection of a quoted price or Requote. A Pending Order (such as a Limit or Stop) is placed ahead of time and automatically executes when the market price reaches the predetermined level, without any manual confirmation or Requote mechanism. Instant execution is for immediate action; a Pending Order is for future, conditional action.

Broker differences in Instant execution across the industry

The availability and consequences of Instant execution are tied to the broker’s internal risk structure.

How to verify Instant execution on your trading platform

Instant execution is primarily a feature of MetaTrader 4 (MT4) platforms and its verification involves checking the order ticket defaults.

• Launch MT4 Terminal: Open the MetaTrader 4 desktop application.
• Open Order Ticket: Use the F9 shortcut key or double-click an instrument in the Market Watch window.
• Check Order Type: In the Type dropdown menu, verify if “Instant Execution” is the default or available option.
• Examine Deviation Box: Look for the presence of the “Maximum Deviation” checkbox or field within the order ticket.
• Set Zero Deviation: Enter 0 (zero) in the deviation field; this maximizes the probability of a Requote when the market moves.
• Place Trade during Volatility: Attempt to place a small market order on EUR/USD during the first 5 minutes of a major news release.
• Observe Pop-up: If the execution method is Instant execution, a new window will pop up with the new price (the Requote) instead of the trade executing instantly.
• Sanity check: The presence of a “Maximum Deviation” box and a Requote pop-up confirm the broker is using the Instant execution model for that order type.