Market Orders in BSE :
In case of market orders placed on BSE (Not applicable for NSE), all buy market orders go to the Exchange with the price of the best offer and all sell market orders go to the exchange with the price of the best bid offer. In case at that point of time it is found that a particular bid or offer is no longer present in the exchange this market order gets cancelled suo moto by the exchange. In case of part execution of market order, the remainder order gets converted into a limit order at the last executed price.
Consider the example where the Bid and Offer Price for a given stock is 99 and 100 respectively.
In case you place a market buy order the order will go to the exchange as a market order of Rs. 100 and will be executed at Rs. 100 or at a better rate. However, in case it is found that the offer of Rs. 100 is no longer present in the exchange this order will be suo moto cancelled by the exchange. In case of part execution of this order at Rs. 100 the remainder of the order will be converted to a limit order at Rs. 100.
In case you place a market sell order the order will go to the exchange as a market order of Rs. 99 and will be executed at Rs. 99 or at a better rate. However, in case it is found that the bid of Rs. 99 is no longer present in the exchange this order will be suo moto cancelled by the exchange. In case of part execution of this order at Rs. 99 the remainder of the order will be converted to a limit order at Rs. 99.
Market Orders in BSE can also be placed with a Protection Percentage.