What is a One-Cancels-the-Other (OCO) Order? 2025 Guide for Australian Investors

If you’ve ever wanted to automate your trading decisions and lock in profits while managing risk, the One-Cancels-the-Other (OCO) order deserves a spot in your financial toolkit. As Australian markets get more volatile and trading platforms grow smarter, OCOs are becoming a go-to tool for everyone from day traders to long-term investors. Here’s what you need to know about OCOs in 2025—and how they could work for you.

What Exactly is a One-Cancels-the-Other (OCO) Order?

An OCO order is a paired trading instruction that lets you place two conditional orders at the same time. If one order is triggered and executed, the other is automatically cancelled. This is particularly useful for traders who want to bracket their trades—for example, setting a profit target and a stop-loss at the same time. If either your profit is reached or your stop-loss is hit, the remaining order is voided, so you’re never exposed to unwanted risk.

• Profit-taking + Stop-loss: You can sell if a stock hits your target price, or cut losses automatically if it drops below a certain level.
• Entry orders: OCOs can also be used to enter positions, such as buying if a breakout occurs or selling if a breakdown happens.

OCOs are supported by most Australian brokers, including both legacy platforms and new fintech apps. In 2025, major ASX brokers like CommSec, SelfWealth, and IG Markets have enhanced their OCO order interfaces, making them more accessible and flexible for retail investors.

Why OCO Orders Matter in the 2025 Australian Market

Australian investors are facing a unique landscape in 2025: persistent inflation, ongoing RBA rate adjustments, and higher-than-usual market volatility. OCO orders help traders navigate these conditions by:

• Automating risk management: No more worrying about missing the market when you’re at work or asleep. Your risk parameters are set in advance.
• Reducing emotional trading: With your profit and loss boundaries pre-set, you’re less likely to panic-sell or get greedy.
• Taking advantage of fast-moving opportunities: In a market where swings can be sudden, OCOs let you react instantly—without needing to manually adjust your trades.

With the 2025 ASX implementing tighter best-execution rules and transparency requirements, brokers are now required to display clearer OCO order statuses and execution reports. This gives investors greater confidence that their conditional orders are being managed correctly.

Real-World OCO Order Examples for Australian Traders

Let’s look at how a typical OCO order plays out on the ASX:

• You own 500 shares of CSL Limited (CSL) trading at $290.
• You want to sell if the price hits $310 (profit target), but also protect yourself if it drops to $280 (stop-loss).
• You place an OCO order: Sell Limit at $310 and Sell Stop at $280.
• If CSL jumps to $310, the sell limit is triggered and your stop order at $280 is cancelled automatically.
• If CSL tumbles to $280, your stop-loss is triggered and your profit-taking order at $310 is cancelled.

This approach ensures you lock in gains or cut losses without having to monitor the market 24/7.

Some Australian brokers also let you use OCOs for more advanced strategies, such as options trading or FX. In 2025, platforms like CMC Markets and Saxo Markets have added OCO functionality for multi-leg derivative trades, giving sophisticated investors even more control.

Tips for Using OCO Orders Effectively in 2025

• Check your broker’s OCO rules: Each platform may have slight variations in how OCOs are implemented. Some only support OCOs for certain asset classes or trading hours.
• Be mindful of slippage: In fast markets, your stop-loss may be filled at a worse price than you set. Make sure your OCO parameters reflect the volatility of your chosen security.
• Review OCO status regularly: Even with automation, it’s worth checking your open orders after big market moves—especially in light of the ASX’s updated 2025 order transparency regulations.

Conclusion: OCO Orders Put You in the Driver’s Seat

As the Australian trading environment grows more complex, OCO orders are emerging as a must-have tool for anyone serious about investing. They offer a smart, automated way to manage risk and seize opportunities—whether you’re a seasoned trader or a first-timer. With new regulatory support and better technology, 2025 is the perfect time to explore how OCO orders can fit into your financial strategy.