In plain English
What One cancels the other means
OCO pairs two or more orders so that only one can survive after a fill. Traders often use it to bracket a position or to set alternative exit conditions. If one side executes, the remaining linked instructions are canceled to prevent both from triggering.
Why it matters
OCO helps manage conditional execution without manual intervention. It can reduce the chance of conflicting orders staying live at the same time, but it still depends on venue behavior, order type rules, and the trader understanding exactly what is linked and when cancellation occurs.
Example
A trader enters a buy stop above the market and a buy limit below the market as an OCO pair. If price rises and the stop order fills first, the limit order is canceled automatically. If price falls and the limit fills first, the stop order is canceled; values are simplified.
Quick answers
Common questions
Can OCO orders include more than two orders?+
Yes, some venues allow groups of linked orders rather than just a simple pair. The exact supported structure depends on the platform.
Does one fill cancel the others immediately?+
Usually yes, but the timing and mechanics are venue-specific. Traders should check whether the platform cancels on partial fill, full fill, or another condition.
Sources