Time Precedence
Market Microstructure glossary · Limit Order Book Mechanics & Order Routing Logic
Definition
The rule that among orders at the same price, the order that arrived first executes first.
Time Precedence in plain English
Imagine ten people all willing to pay exactly $50 for a concert ticket, and only a few tickets are left — who gets served first? Time Precedence is the fairness rule that says: whoever placed their order EARLIEST goes first. On an exchange, when many orders sit at the same price, they form a line, and the market fills them in the order they arrived, first-come-first-served. This is a big reason traders race to submit orders quickly — being early in line means you actually get filled.
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