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Example 2: Scale order with Profit-Taking Orders

Data Assumptions:

Label

Value

NBBO

$26.31 - $26.32

Action

Buy

Total Order Size

10,000

Initial/Subsequent Component Size

400

Starting Price

$26.28

Price Increment

.02

Order Type

Limit

Time in Force

GTC (this is set on the Basic tab of the order ticket)

Create profit taking order Check to enable
Profit Offset 0.20

 

Like example 1, this is an order to buy 10000 shares scaled into 25 components of 400 shares each. In addition, we have instructed TWS to submit profit-taking sell orders against each order component, with a .20 profit offset. This means the profit orders will be submitted at the last filled price level plus the .20 cent offset.

The first 400 share component is submitted as a buy limit order at the Starting Price of $26.28. When the component order fills two things happen. The next component of 400 shares is submitted at $26.26 (component price - price increment), and a sell order is submitted for 400 shares at $26.48 (component price + profit offset).

When the $26.26 price level fills, a sell order for 400 shares at $26.46 (component price + profit offset) is submitted. This pattern continues until all components have filled, or you cancel the order.

Note:  The order will be held if any parent component becomes unmarketable, but the profit orders can continue to work without holding up the order.

Basic Scale with Profit Orders topic.

Important Disclosures