Comment on Stop Loss orders - Limit/Market

Jay commented on 21 May 2015, 05:53 PM

I could not understand your last paragraph
“SL orders to enter new positions:
Assume Nifty 5700 puts is trading at Rs 25. You want to buy this option only when it goes to 26, how do you do this? Because if you put an order to buy at 26 it will get executed at the market price which is lower than 26. In such a scenario you can use SL orders to enter a fresh position. So what you could do is to put a buying SL/SL-M with a trigger price of 25. What happens now is that only when the put option goes above 25, will your trade get executed. This feature can be used by people who like to take trades only when a particular stock/contract moves in your direction.”

1. I think trigger price is not 25 It should be 26. Am I correct?
2. If Trigger price is 26 and currently trading at 25. when the price reached 26 then the trigger will fire. But the question is at what price sytem will buy. Market price?

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