Opening Imbalance Only Order (OIO)

Posted on by user

Opening Imbalance Only Order (OIO)

An Opening Imbalance Only order (OIO) is a limit order type used on the Nasdaq that provides hidden liquidity specifically for the opening cross. It is designed to participate only in the auction that determines the opening price and is not displayed in the continuous market.

How it works

  • Executable only during the Nasdaq opening cross (the process that establishes the opening trade price at market open).
  • Must be a limit order; market OIOs are not permitted.
  • OIO buy orders will execute at or below the established 9:30 a.m. bid price; OIO sell orders will execute at or above the 9:30 a.m. offer price.
  • OIOs are not displayed or disseminated prior to the opening cross (they are hidden).
  • If an OIO is priced more aggressively than the prevailing Nasdaq highest bid or lowest offer before the open, it will be re‑priced to that bid or offer prior to execution. For example: an OIO buy at $9.95 would be re‑priced to $9.93 if the Nasdaq bid is $9.93.

Timing and order entry

  • Nasdaq accepts OIO orders beginning in the premarket (7:00 a.m. local exchange time).
  • Orders can be entered after 9:28 a.m., but existing OIO orders generally cannot be updated after 9:28 a.m. prior to the opening cross.

Comparison with other opening orders

  • Market‑On‑Open (MOO): a market instruction to execute at the opening price; not price‑protected and subject to full market exposure.
  • Limit‑On‑Open (LOO): a limit order to execute at the opening price; may be displayed depending on settings.
  • OIO: a limit order reserved for the opening cross that is hidden and price‑protected by the limit instruction; it contributes liquidity to the opening auction without being shown in the order book.

Benefits

  • Adds hidden liquidity to the opening auction, which can improve price discovery and execution quality for other opening orders.
  • Prevents execution prior to the opening cross (unlike continuous market orders).
  • Protects against executing at worse prices than the limit (because it is a limit order).

Limitations and considerations

  • Only eligible for execution during the opening cross—no fills during continuous trading.
  • May not be filled if the opening cross price is outside the order limit.
  • Orders may be repriced to the prevailing pre‑open bid/offer, which can result in a less aggressive fill than originally entered.
  • Limited ability to modify orders in the final minutes before the open.

Where it executes

OIOs are executed within the Nasdaq opening cross, the electronic auction mechanism used to determine opening prices on the Nasdaq exchange.

In summary, OIOs are useful for traders and market participants who want to add non‑displayed, limit‑protected liquidity specifically to the Nasdaq opening auction without risk of execution before the market opens.