Leg

A "leg" is one piece of a trade that's actually made up of several separate trades working together as one strategy. If you're only buying or selling a single stock outright, there's no leg to speak of — the word only shows up once a position has multiple parts that need to happen for the whole strategy to be in place.

The classic case is options combinations. A straddle, for instance, means buying a call (a contract that profits if a stock rises) and a put (a contract that profits if a stock falls) on the same underlying stock at the same time. Each of those two contracts is a "leg" of the straddle. Spreads, collars, and pairs trades (buying one stock while shorting another) work the same way — each individual buy or sell that makes up the bigger position is a leg.

The nuance that trips people up is timing and risk. Legs can be executed simultaneously as one combined order, where a broker or exchange fills all parts together at a known net price, or they can be "legged into," meaning the trader manually places each leg as its own separate order, one after another. Legging in can save on transaction costs or let a trader time entries more precisely, but it opens a gap: if the price moves between filling the first leg and the second, the trader may end up with a worse price on the second leg, or fail to fill it at all. When that happens, the trader is said to have gotten "legged," left holding an unbalanced, unintended position instead of the clean strategy they meant to build.

So "leg" describes a structural piece of a multi-part trade, and "legging in/out" or "getting legged" describes the practice — and the risk — of building or unwinding that structure one piece at a time rather than all at once.