[TheOptionClub.com] Trade Triggers

 

Does anyone have experience with TD Ameritrades trade triggers?

I think I'm going to setup a trade trigger where if the SPY rises above my short strike, to just buy back the position.

Questions:

1) Should I set it so if the bid rises above my short strike, buy back the position? OR, if the bid rises above my short strike PLUS the premium received?

If I simply buy it back as soon as it hits the short strike, could I lose money?

Of course, with the premium, when I graph it in options oracle, it shows a profit above the short strike. However, I'm thinking if IV changes, then I could lose money even if I buy it back below the short strike.

2) Just to be safe, should I just select market order rather than limit order? When placing trades, I always use limit orders and never use market orders. However, I'm thinking for the trade trigger if it's a fast moving market or it jumps or if I calculate the limit price incorrectly, then it may not get filled.

Will the market order always be placed at the ASK price if I'm choosing buy to close? Or, does it end up being 5 cnets or 10 cents higher?

__._,_.___

Reply to sender | Reply to group | Reply via web post | Start a New Topic

Messages in this topic (1)

Recent Activity:

• New Members 11
• New Links 2

Visit Your Group

The goal of TheOptionClub is to provide a forum for members to work together for the purpose of furthering our individual understanding option trading.  All messages and postings, and any materials circulated are provided for discussion and educational purposes only.  No statement contained in any materials from TheOptionClub should be considered a recommendation to buy or sell a security or to provide investment, legal or tax advice.  All investors are encouraged to consult a qualified professional before trading in any security.  Stock and option trading involves risk and is not suitable for most people.  There is no guarantee that any information provided is accurate and, may in fact, be wrong.  It is understood that the participants in TheOptionClub have varying backgrounds and degrees of experience in option trading, and that regardless of experience each member is considered a student.  As such, any information distributed through TheOptionClub should be considered with a critical mind and not relied upon as an authoritative source.

To unsubscribe from TheOptionClub, send an email to:
OptionClub-unsubscribe@yahoogroups.com

Switch to: Text-Only, Daily Digest • Unsubscribe • Terms of Use

.

__,_._,___