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Key Takeaways
- A market-on-close order participates in the closing auction without a limit price.
- A limit-on-close order adds a maximum buy price or minimum sell price.
- On a standard closing day, ordinary NYSE MOC entry closes at 3:50 p.m. ET and Cboe BZX MOC entry closes at 3:55 p.m. ET.
- The worked 40,000-share execution at $88.40 costs $3,536,000.
- Compare the auction fill with both the closing benchmark and the order’s arrival reference.
What is a market-on-close (MOC) order?
A market-on-close (MOC) order is an instruction that submits unpriced buy or sell interest to the exchange’s closing auction, where the auction process sets its execution price and matched quantity. A limit-on-close (LOC) order adds a maximum buy price or minimum sell price. Both instructions target the auction rather than continuous trading.
Benchmark managers use closing orders to align executions with the close. Traders also use them to manage an end-of-day position or hedge. The order’s stated objective determines which instruction fits the plan.
Formula
Executed notional = filled shares × auction price; buy cost versus arrival reference = (auction price − arrival reference) × filled shares- The example uses $88.10 as its stated arrival reference and $88.40 as its auction execution price.
- A fill at the closing benchmark has zero execution-price difference from that benchmark.
- Portfolio tracking error measures variation in portfolio returns relative to benchmark returns.
MOC order example: a 40,000-share buy at the close
A portfolio manager must buy 40,000 shares of XYZ at the benchmark close. The stock quotes near $88.10 at 3:45 p.m. Eastern Time, and the manager sends a market-on-close order before the entry deadline. The closing auction prints at $88.40.
- Filled quantity: 40,000 shares at $88.40
- Executed notional: 40,000 × $88.40 = $3,536,000
- Cost versus the $88.10 arrival reference: $12,000
- Execution-price difference versus the $88.40 closing benchmark: $0.00 per share
The specified execution fills all 40,000 shares at the $88.40 closing benchmark. It costs $12,000 above the $88.10 arrival reference. In a separate comparison using that same auction price, a buy LOC capped at $88.20 receives no fill.
The fill has zero price difference from its $88.40 closing benchmark. This is a trade-price comparison; portfolio tracking error is a separate return-based measure.
At that same auction price, a separate buy LOC with an $88.20 limit has no eligible fill. The two instructions express different price requirements.
MOC order cutoff times on NYSE and Cboe BZX
For the standard 4 p.m. ET close, ordinary NYSE MOC entry ends at 3:50 p.m. ET. After that cutoff, eligible offsetting interest follows the exchange’s published imbalance rules. Cboe BZX requires MOC orders before 3:55 p.m. ET.
Entry and cancellation are distinct actions. Complete ordinary NYSE changes before its 3:50 p.m. ET cutoff and Cboe BZX changes before 3:55 p.m. ET. The broker’s submission deadline and acknowledgment establish the order sent for the selected security and session.
How the closing auction fills an MOC order
Follow the indicative price, paired quantity and imbalance for the listing exchange. The closing process combines eligible auction interest and determines the matched executions under that venue’s rules.
After the auction, reconcile the filled quantity, execution price and remaining position. If the close fills the stock leg of an options position, enter the auction price and your option premiums in the options profit calculator to read the combined payoff from actual fills.
Limitations of market-on-close orders
- Add a limit-on-close price when you need price protection. An MOC order has no price limit and accepts the auction price, which in the example cost $12,000 more than the $88.10 arrival reference.
- Ordinary entry and cancellation end at the exchange cutoff, 3:50 p.m. ET on NYSE and 3:55 p.m. ET on Cboe BZX for a standard close. Submit by the earlier of that cutoff and your broker’s own deadline.
- Grade the fill against the reference you care about. The $88.40 fill matches the closing benchmark exactly and still costs $12,000 against the $88.10 arrival price.
- MOC interest enters the auction calculation, so a large order moves the imbalance that shapes the closing price it receives. Read the published imbalance before you size it.
Bottom line
A market-on-close order hands execution to the closing auction, which makes it the direct tool for matching a closing-price benchmark. Submit before the exchange and broker cutoffs, follow the published imbalance and indicative price, and use a limit-on-close order when price protection matters more than participation.
Clear answers
Frequently Asked Questions
Sources and Further Reading
- NYSE: Opening and Closing Auctions Fact Sheet
- Cboe: Titanium U.S. Equities Auction Process
- Nasdaq: Opening and Closing Crosses
- Fidelity: Trading FAQs on Order Types
How entries are sourced, calculated and updated: editorial methodology.