What Is OCO (One-Cancels-Other) Order?
A One-Cancels-Other order links two orders so that when one fills, the other is automatically cancelled. The classic use: bracket a position with a profit-taking limit order and a stop-loss order. Whichever hits first cancels the other.
OCO is the standard way to set up automated exit management. Without it, a trader who's away from the screen could end up with both a profit-taking fill and a stop-loss fill if price round-trips, creating an unintended short position.
Most brokers offer OCO under the name 'bracket order' or 'OTOCO' (one-triggers-one-cancels-other) for the full entry-and-exit pattern. Highly recommended for any position you're not actively monitoring — it eliminates the need to be at the screen during scheduled moves.
Related terms
- Stop Loss — A predefined exit price that limits losses if a trade moves against you.
- Limit Order — An order to buy or sell at a specified price or better — guarantees price, not execution.
- Trailing Stop — Dynamic stop that moves with favorable price action, locking in profits.
- Stop-Limit Order — Combined stop trigger plus a limit price — protects against slippage but may not fill.