Educational purposes only. This content does not constitute investment advice. Read our disclaimer
StockCram is not a broker-dealer, investment adviser, or financial institution. All content is for educational and informational purposes only and should not be construed as personalized investment advice. Consult a qualified financial professional before making investment decisions. Past performance does not guarantee future results.Simple Definition
One-Cancels-the-Other — a rule that links two orders so the moment one fills, the broker automatically cancels the other.
Why It Matters
OCO is the wiring underneath every bracket order's exit pair, but it's also useful on its own. If you already own a position, you can attach an OCO that pairs a profit-target with a stop-loss — when one fills, the other cancels, so you can't end up with both filling and accidentally going short the stock. Standalone OCO is the cleanest way to put an exit plan on a position after the fact.
Key Points
- Pairs two orders — one fills, the other cancels
- Used inside bracket orders to link the two exits
- Useful standalone to add an exit plan to an existing position
- Prevents accidentally ending up with both exits filling
Learn More
Bracket Orders & OCO
Get a complete explanation with examples, key takeaways, and a quiz to test your knowledge.
Related Terms
Common Questions
One-Cancels-the-Other — a rule that links two orders so the moment one fills, the broker automatically cancels the other. OCO is the wiring underneath every bracket order's exit pair, but it's also useful on its own. If you already own a position, you can attach an OCO that pairs a profit-target with a stop-loss — when one fills, the other cancels, so you can't end up with both filling and accidentally going short the stock.
OCO is the wiring underneath every bracket order's exit pair, but it's also useful on its own. If you already own a position, you can attach an OCO that pairs a profit-target with a stop-loss — when one fills, the other cancels, so you can't end up with both filling and accidentally going short the stock. Standalone OCO is the cleanest way to put an exit plan on a position after the fact.
Pairs two orders — one fills, the other cancels
Used inside bracket orders to link the two exits
Useful standalone to add an exit plan to an existing position