Can you expand on the “Market on Close” (MOC) order?

Hi Michael,

The ASX goes into what’s called the “Match Out” during this time anyone can enter an order while the markets in limbo but there is no guarantee it will be filled at 4.10pm when the the market matches out or what is often referred to as the spin on the trading desk:

e.g. lets say BHP closes at $46.40 and you’ve been sitting on the bid at $46.30 with no joy, or for that matter you’ve been contemplating a purchase and haven’t pulled the trigger, you have some options between 4.00 & 4.10pm, for example:

1. Stay at $46 .30 and hope BHP matched lower.
2. Bid $46.40 ad hope it settles at this level at 4.10pm and you get set, no guarantee.
3. Bid say $50.00 and know that you’ll get whatever the stock closes at (as long as it’s below $50). NB:  Okay to do in BHP but best not to do this in very low volume stocks.

Lets say BHP then closes at $46.44, orders 1 & 2 will not be filled while order 3 will be filled at $46.44. If someone had entered a bid at $46.44 there’s no guarantee they will have been filled, this will be actioned on a cue like basis.

The match is calculated by an algorithm at the ASX, with the overlapping market, all buy orders that had been submitted above the auction price will have traded, just as all sell orders that had been submitted below the auction price will have traded.