FOK Fill or Kill

Fill or Kill (FOK) is a type of order that instructs the broker to either execute the entire order immediately at the specified price or cancel the order entirely. Partial execution is not accepted; the order must be completely filled in one go or cancelled altogether.

What Is a FOK Order?

When you place a FOK order:
– If the full quantity is available at your price: the entire order executes immediately
– If the full quantity is NOT available: the entire order is cancelled, even if partial execution was possible

FOK is stricter than IOC (Immediate or Cancel), which allows partial fills. FOK demands all-or-nothing.

When Is FOK Used?

– **Block trades**: institutional investors wanting to buy or sell a large block of shares need the full quantity or nothing (partial fills create position management complications)
– **Arbitrage strategies**: arbitrage requires equal-sized positions on both sides; a partial fill breaks the hedge
– **Options strategies**: complex multi-leg options trades require all legs to be filled for the strategy to work

FOK vs IOC

| Feature | FOK | IOC |
|———|—–|—–|
| Partial fill | Not allowed | Allowed |
| Full fill required | Yes | No |
| If not fully fillable | Entire order cancelled | Unfilled portion cancelled |

Practical Example

An arbitrage trader needs to simultaneously sell 10,000 shares of a stock on one exchange and buy the equivalent through a different instrument. She uses a FOK order for both. If the full 10,000 shares cannot be sold at her price immediately, the FOK order cancels entirely, preventing an incomplete hedge that would leave her with unhedged exposure.

Key Takeaways

– FOK orders require complete immediate execution; no partial fills allowed
– If the full quantity cannot be filled at the specified price, the entire order is cancelled
– Used for block trades, arbitrage strategies, and multi-leg options structures
– Stricter version of IOC; IOC allows partials, FOK does not
– Available on Indian exchanges for equity and derivative segments