Trailing Stop Links

Trailing stop orders can be regarded as dynamical stop loss orders that automatically follow the market price. You can use these orders to protect your open position: when the market price reaches a certain critical value (stop price), the trailing stop order becomes a market order to close that position.

The initial trailing stop value is set at a certain distance (offset) away from the immediate market price of the instrument. For trailing stop orders to buy, the initial stop is placed above the market price, thus the offset value is always positive. For those to sell, it is placed below, which suggests the negative offset. Once placed, the stop value is constantly adjusted based on changes in the market price.

Trailing stop orders to buy lower the stop value as the market price falls, but keep it unchanged when the market price rises. For trailing stop orders to sell, it's vice versa: the stop value follows the market price when it rises, but remains unchanged when it falls.       

Example

Let's say you bought a stock at $25 per share and would like to protect it with a trailing stop. You place a trailing stop order to sell with an offset of $2 which means that the initial trailing stop value is $23. Should the market price rise to, for example, $35, the trailing stop will be adjusted (kept $2 away from the market price, so, in our case it will be equal to $33). But if having reached that level, the market price starts falling, the trailing stop will keep its value of $33. Given that market price continues to fall and reaches this value, the trailing stop order becomes a market order with the sell price $33.

How to add it

1. Add an order of the proper side anywhere in the application.

2. In the Order Confirmation dialog, click Edit. The Order Entry Tools panel will appear.

3. In the Order Entry ticket, choose TRAILSTOP from the Order drop-down list.

4. Click the gear-and-plus button on the right of the order line. The Order Rules dialog will appear.  

5. In this dialog, specify both type of the market price that needs to be monitored (STOP Type) and the price type with which the trailing stop is calculated (STOP Linked to). Available choices for the former are:

- ASK or MARK for Buy orders;

- BID or MARK for Sell orders.

6. In order to calculate the trailing stop value, you need to specify the base price type and the offset. 

7. Click OK.

8. In the Order Entry ticket, click Confirm and Send.

 

Trailing stop calculation

Trailing stop is calculated using a certain price type, which you specify in the Order Rules dialog (STOP Linked To drop-down list). You can choose any of the following options:

- LAST. The trailing stop price will be calculated as the last price plus the offset specified as an absolute value.

- LAST%.  The trailing stop price will be calculated as the last price plus the offset specified as a percentage value.

- BID. The trailing stop price will be calculated as the bid price plus the offset specified as an absolute value.

- BID%.  The trailing stop price will be calculated as the bid price plus the offset specified as a percentage value.

- ASK. The trailing stop price will be calculated as the ask price plus the offset specified as an absolute value.

- ASK%.  The trailing stop price will be calculated as the ask price plus the offset specified as a percentage value.

- MARK. The trailing stop price will be calculated as the mark price plus the offset specified as an absolute value.

- MARK%.  The trailing stop price will be calculated as the mark price plus the offset specified as a percentage value.

- AVG PRC. The trailing stop price will be calculated as the average fill price plus the offset specified as an absolute value. The average fill price is calculated based on all trades that constitute the open position for the current instrument.

- LAST T.  The trailing stop price will be calculated as the last price plus the offset specified in ticks.

- BID T.  The trailing stop price will be calculated as the bid price plus the offset specified in ticks.

- ASK T.  The trailing stop price will be calculated as the ask price plus the offset specified in ticks.

- MARK T.  The trailing stop price will be calculated as the mark price plus the offset specified in ticks.

- AVG PRC%. The trailing stop price will be calculated as the average fill price plus the offset specified as a percentage value. The average fill price is calculated based on all trades that constitute the open position for the current instrument.

- AVG PRC T. The trailing stop price will be calculated as the average fill price plus the offset specified in ticks. The average fill price is calculated based on all trades that constitute the open position for the current instrument.

- ASK/BID. The trailing stop price will be calculated as either the bid or the ask price plus the offset specified as an absolute value. The system automatically chooses the ask price for Buy orders and the bid price for Sell orders.

- ASK/BID%.  The trailing stop price will be calculated as the bid price plus the offset specified as a percentage value. The system automatically chooses the ask price for Buy orders and the bid price for Sell orders.

- ASK/BID T.  The trailing stop price will be calculated as the bid price plus the offset specified in ticks. The system automatically chooses the ask price for Buy orders and the bid price for Sell orders.

The Active Trader Ladder is a real-time data table that displays bid, ask, and volume data for the current symbol based on a price breakdown. By default, the following columns are available in this table:

  • Volume column displays volume at every price level for the current trading day.
  • Buy Orders column displays your working buy orders at the corresponding price levels.
  • Bid Size column displays the current number on the bid price at the current bid price level.
  • Price displays the price breakdown; prices in this column are sorted in descending order and have the same increment equal, by default, to the tick size. You can change this increment by clicking   (Zoom In/ Zoom Out) buttons in the control bar to the right of the table. Current market price is highlighted in gray. To center the Active Trader Ladder so the market price is exactly in the middle, click  (Center View) in the control bar to the right.
  • Ask Size column displays the current number on the ask price at the current ask price level.
  • Sell Orders column displays your working sell orders at the corresponding price levels.

Columns in the Active Trader Ladder are customizable: click on the  (small gear) button in the top right corner of the table and choose Customize; the Customize Active Trader dialog will appear. Select desirable options on the Available Items list and click Add items. Additional items, which may be added, include:

  • Fills will display the number of orders that have filled during the day, at their corresponding price levels;
  • Orders will display bubbles of working buy and sell orders in a single column at their corresponding price levels;
  • P/L Open will display profit/loss values since the position was opened, calculated at every price level;
  • Trade Cnt will display the number of trades at every price level for the current trading day. You can also remove unnecessary columns by selecting them on the Current Set list and then clicking Remove Items. Click OK to update the Active Trader Ladder columns.

Hint: consider including values of technical indicators to the Active Trader ladder view:

  1. Add some studies to the Active Trader Chart.
  2. Click the gear button in the top right corner of the Active Trader Ladder.
  3. Select Show Chart Studies.
  4. Look for your study values in the Price column: those will be marked by circles, triangles, squares, or diamonds at corresponding price values. Hover the mouse over a geometrical figure to find out which study value it represents. If some study value does not fit into your current view (i.e., it is too high or too low), you will see an arrow pointing in the direction to scroll the ladder to find this value.
  5. You can add orders based on study values, too. Right-click on the geometrical figure of the desirable study value and choose Buy or Sell. Proceed with order confirmation.

Position Summary

Above the table, you can see the Position Summary, a customizable panel that displays important details of your current position. By default, the following metrics are displayed: buys and sells you’ve had during the trading day, total current position in the account, average price of the position currently in the account, the profit/loss value since the position was opened, and current day’s profit/loss.

To customize the Position Summary, click Show actions menu and choose Customize... The Customize position summary panel dialog will appear. Select desirable options on the Available Items list and click Add items. The only additional item that is not displayed by default is Day only position, which will display today’s total position.

You can also remove unnecessary metrics by selecting them on the Current Set list and then clicking Remove Items. Click OK to update the Active Trader Ladder columns.

The Options Time and Sales section details all of the “Time and sales” data for all the option trades that have occurred on the underlying during the current trading day. To access this data, click on the V-shaped icon  before the section title.

The data is broken into two major sections:

  • Today’s Biggest: The largest Call and Put trades reflective to the selected underlying on the current day.
  • Time: All trades listed chronologically.

The following columns are available in both of the above sections: the time of the trade, the option traded, the quantity of the trade, the execution price, the exchange where the trade occurred, the bid/ask of the option, the option’s delta, implied volatility, and the price of the underlying security.

The data is colored based on the following scheme:

  • Option names colored blue indicate call trades.
  • Option names colored purple indicate put trades.
  • Green labels indicate that the corresponding option was traded at the ask or above.
  • Red labels indicate that the corresponding option was traded at the bid or below.
  • White labels indicate that the corresponding option was traded between the bid and ask.
  • Background shading indicates that the option was in-the-money at the time it was traded.

To sort the data you would like to view, click on the Filter button  in the top-right corner of the section. In the menu that appears, you can set the following filters:

  • Side: Put, call, or both.
  • Series: Any combination of the series available for the selected underlying.
  • Strikes: Minimum and/or maximum strike price.
  • Exchange: Trades placed on a certain exchange or exchanges.
  • Quantity: Minimum and/or maximum quantity traded.
  • Price: Minimum and/or maximum trade price.
  • Condition: Part of a certain strategy such as straddle or spread.