Which statement regarding order to trade ratio is incorrect?

The focus on the order to trade ratio is essential in trading environments as it relates to the effectiveness and efficiency of market participants in operating within the trading system. The correct choice emphasizes that maintaining a proper balance between different types of orders is not a standard requirement in the context of evaluating the order to trade ratio.

In trading contexts, the order to trade ratio typically considers the relationship between the number of orders submitted (like limit and market orders) against the actual trades executed. While managing the proportion of orders to trades is critical for market functioning, the specifics regarding limit versus market orders do not constitute a formal requirement that participants must adhere to in the same way as they would for modifications or quote entries compared to contracts traded.

This makes the statement about ensuring a proper ratio between limit and market orders inconsistent with the core focus of the order to trade ratio, which is concerned more universally with the overall effectiveness of order flow regarding executed trades rather than the specific types of orders involved.

Other statements address aspects such as modifications or quote entries relative to contracts traded, which are indeed areas of concern for trading participants to monitor to ensure market integrity and efficiency.