short sell limit question

Discussion in 'Order Execution' started by antincedo, Oct 31, 2008.

  1. ok prob a really newbie question but i just got ib and am using quotetracker, sim trading

    whenever i put in a limit order to short sell it gets filled automatically before it hits the limit price.

    what am i doing here?
  2. Is the price of your limit order greater than or less than the current market price quote?
  3. less than.. i suppose this is why?

    how do i put in a short limit order?
  4. TraDaToR


    LOL...You have to alert SEC about this software encouraging short selling
  5. TraDaToR


    For real, you need to use short "stop" orders
  6. Long: Stock is 25. You want to buy 100 at 24 --> Qty 100, Buy@limit 24. Will be executed when stock drops to 24 (simplistically).

    Short: Stock is 25. You want to short 100 at 26 --> Qty 100, Sell@limit 26. You will be short 100 shrs if stock rises to 26, if you don't already have a long position in the stock, and it is shortable.
  7. so i cant put a short in at a limit price if the stock is above that price?

    and i cant put a buy limit order if the limit price is below its current price?

    how to do the opposite of this
  8. Sounds like you really want a Stop-Limit order. With those, you specify a Stop price and a Limit price.

    Stop-Limit Short: Stock is 25. As it travels down, you want to initiate a short if/when it hits 24 --> Qty 100, StpLmt Sell Stop@24, Limit@24. This means the Limit order will not be "live" until the bid hits 24. Then the Sell Limit order will (hopefully) fill at 24.

    Note that in a fast market the stock could trade through 24 and then the limit sell will not execute. You may have to make the limit a bit lower than the stop. Use just a Sell Stop order if you just have to get in. Stop orders turn into Market orders at the stop price. But in a fast market/thin stock the fill price might be fairly far away.

    You really should read the complete user manual for your trading workstation. It will have all this stuff in there.