IB: futures stop loss orders in gap openings

Discussion in 'Retail Brokers' started by pcvix, May 20, 2006.

  1. pcvix



    When one has a catastrophe stop order placed, and there's a huge gap opening as a result of, say, a black swan event, such that prices drop way below the stop level, will such stop order still be executed at the first opportunity on the IB platform?

    As an example, say one is short one Eurex FX contract (6E) at 1.2750 at Friday's close, with a GTC stop loss order at 1.3000. Something happens over the weekend and the Dollar drops precipitously late Sunday, and 6E opens at 1.3250 at 6:00pm EST. Is it likely that the stop loss order will be executed at first opportunity at market?

    Liquidity will of course be an issue but, for the sake of discussion, let's focus on the most liquid futures products.

    Does anyone have any insight into or experience with this scenario? Perhaps an IB representative can shed a little light on the matter?

  2. pcvix


    Typo correction:

    For Eurex FX, read Euro FX.
  3. alanm


    Assuming it is set to allow triggering outside RTH, your stop should be triggered just after the opening time Sunday either by the first print or by the first change in the quote (bid or ask - I forget which) price or increase in its size.

    If it is, instead, set to trigger RTH-only, it will happen just after 09:30 ET Monday (assuming the market is still above your stop).