Bracket Orders

Hi Matthew or anyone,

I believe I saw where you may have addressed this issue recently by entering two (buy and sell) pending orders.

My question is, if I have a open "buy xyz" position, can I create two pending "sell to close xyz" orders, 1 to sell at a profit level and the 2nd to sell at EOD using the park feature? The idea is I will sell it for sure that day, either at the profit target or EOD and the other order will not execute.

Is this possible?

There is no reason you can’t do this. Just enter two orders, both parked-until a specific release time. You should group both orders into one OCA group. This last part ensures that one order executes, the other will be cancelled.

Hi Matthew,

Thank you for your answer.

I’m sorry I wasn’t clear in the first post. I am really asking a theoretical question. I know I can obtain the resulting condition as you stated with an OCA grouping.

What I am asking is if you DON’T group them with an OCA classification, will the second order fail to execute (sell to close) and be cancelled if the original buy order has been closed?

I’m trying to understand what happens in the C2 process where a trader forgets the last step of the OCA grouping.

Ah, now I understand your question. The answer is that, in theory C2 will notice that there is a working Sell-to-Close order hanging around while there is no long position remaining in the account against which to trade it. In this case C2 will cancel the orphaned order.

However, this recognition will not be instantaneous, and during the time it is not recognized, there is always a small chance the stop will get hit in someone’s account. That is why I strongly encourage you to use OCAs if you can.

I see, the problem might arise if you then try to buy that security again. The previous orphaned stop could come back to haunt (sorry, it’s halloween) you and stop you out unintended.