Opening and Closing AuctionsMOO
Many stock exchanges open and close the trading day with an auction: orders are collected and matched at a single price that maximises the volume traded. Market-on-open (MOO) and market-on-close (MOC) orders are designed to execute in these auctions. Closing prices from the auction are used to value funds and indices.
Many exchanges start and end the trading day with an auction. Orders are collected and matched at one price that maximises traded volume. Closing auction prices are widely used to value funds and indices, and the exact rules and times vary by exchange.
- Category
- Market Structure
- Reading time
- 3 min
- Also called
- Opening cross, Closing cross, Call auction
- Updated
Auctions in plain words
Nasdaq's closing cross matches orders at one single price in the last moments of the trading day to set the close.1
In the cross, auction-only orders are combined with the regular order book to produce one opening or closing price.2
The closing cross sets the official close for every Nasdaq-listed stock.1
How an auction works
Enter auction orders
Use auction order types such as market-on-open or market-on-close; on Nasdaq, market-on-open orders must arrive before 9:28 a.m. Eastern time.2
Watch imbalances
Watch the published imbalance — the shares that wouldn't be matched at the current reference price.2
Reference price
Expect the auction price to be the one that matches the most shares, leaves the smallest imbalance and stays closest to the midpoint.2
Merge books
Auction orders and the continuous book are merged into one opening or closing price.2
Execute at one price
All matched orders trade at the same single price.3
Publish official price
The resulting price becomes the official close.1
Worked examples
Example 1 — Uncrossing
Buy imbalanceHypothetical buys: 3,000 at ≥ 50.10; sells: 2,000 at ≤ 50.10, 1,000 at 50.12.
| Matched at 50.10 | 2,000 |
| Imbalance | 1,000 buy |
The 1,000 shares shown are the part that wouldn't be matched at the current reference price.2
Example 2 — Fund valuation
Tracks indexA hypothetical index fund buys at the close to match its benchmark.
| Price | Official close |
Funds trade in the closing cross because it sets the official closing price.1
Example 3 — Late order
MissedA hypothetical MOO order arrives at 9:29.
| Result | Not accepted as MOO |
The order came in after the 9:28 a.m. cut-off for market-on-open orders.2
Auction vs continuous trading
| Aspect | Auction | Continuous trading |
|---|---|---|
| Price | One price for all | Many prices |
| Timing | Open and close | All session |
| Info | Imbalance data | Live quotes |
| Users | Funds, index trackers | Everyone |
Where auctions matter
Session edges
Start and end of Market Hours.
Gaps
Opening price and Price Gap moves.
Volume
Big share of daily Volume.
Rebalancing
Index Rebalancing at the close.
Advantages and disadvantages
Advantages
- Concentrates liquidity at one price.
- Sets fair official prices.
- Publishes imbalance data in advance.
Disadvantages
- Order cut-off times are strict.
- Imbalances can move prices sharply.
- Rules vary by exchange.
- Market-on-close orders give no price control.
Going deeper
Read as far as you need. Each level builds on the one before it.
Purpose
Beginner
The closing cross is a price-discovery auction that matches everything at one price at the end of the day.1
Transparency
Intermediate
Nasdaq publishes detailed, continuous imbalance information in the final minutes before the close.1
Pricing logic
Advanced
The reference price is chosen inside the best bid and offer to match the most shares, minimise the imbalance and stay near the midpoint.2
Common mistakes
Missing cut-offs
Check exchange times.
Ignoring imbalance
It hints at price pressure.
Using MOC in thin stocks
Use LOC for price control.
Assuming same rules everywhere
Rules vary by exchange.
Check your understanding
Test yourself before moving on. Each answer comes with an explanation.
Key points to remember
- Auctions match orders at one price.
- They open and close many exchanges.
- Closing prices value funds and indices.
- Imbalance data hints at pressure.
- Times and rules vary by exchange.
Frequently asked questions
Can retail traders join auctions?
Why is closing volume so high?
Do all exchanges use auctions?
Further learning
- Market Hours
Session times.
- Price Gap
Opening moves.
- Rebalancing
Index flows at close.
- Limit Order
Price control in auctions.
Sources
This article is written in our own words. The sources below support the specific facts, rules and figures marked with a number in the text. Links open the original publisher’s page.
- Nasdaq. Nasdaq Closing Cross (opens in a new tab) Checked .
- Nasdaq. Opening and Closing Cross FAQs (opens in a new tab) Checked .
- U.S. SEC. Regulation NMS Adopting Release 34-51808 (opens in a new tab) Checked .
Educational content, not financial advice. Examples use hypothetical prices and simplified costs; actual fees, margin rules and regulations vary by broker, market and country. We are not affiliated with any publisher linked above. Last reviewed . Report an error or request a source credit.