If I want to buy when the price falls below some threshold...

Discussion in 'Trading' started by mizhael, Aug 6, 2009.

  1. Do I use STOP LOSS MKT BUY order?

    I remember STOP LOSS BUY can only used in one side trade, I forgot which side.

    Is it used for "the current price is above the threshold, and we want to execute the buy order when the price falls below the threshold", or "the current price is below the threshold, and we want to execute the buy order when the price rises above the threshold"?

    Could anybody please tell me which case does STOP LOSS MKT BUY apply to?

  2. academic


    You want a simple buy limit order.

    A buy stop will buy when the price reaches a certain upper threshold and its used to protect a short position.
  3. No I cannot use a simple buy limit order because it doesn't guarantee to fill my order. I got lots of slip thru...
  4. No, if you have a buy limit order and the price gets to a tick below your entry price, you are guaranteed a fill.
  5. Unfortunately my IB didn't fill yesterday...
  6. Details?
  7. A fast market might only fill a portion of a limit order. An MIT order sounds like what you want (if you are willing to sacrifice some slippage for a quick fill). If you want an order type that will fill the full size of your order at a specified price without slippage, you're asking for too much. On the other hand, if you trade in smaller sizes, a limit order might be what you want.
  8. piezoe


    And unfortunately there is no way to get a guaranteed fill with a limit order at your limit price, unless you entered a marketable limit order, i.e. a limit that was above the market when you entered it, and that's not what you intended. If the market trades through the limit price you will get a fill for sure at your price or maybe even a tick better, as Emini pointed out to you. But if the market only trades to your limit you are not guaranteed a fill. The only order that guarantees a fill is a market order. As Circadean pointed out, if you want a guaranteed fill use a market if touched order, assuming your broker provides it and be prepared to lose a tick or so of slippage. Life can be unfair.