Comment on Margins- 2 Exit orders for 1 position

Hanan commented on 13 Nov 2015, 03:09 PM

When you place a Bracket Order, you are setting up a condition for exiting your position after hitting a “trigger.” Your trigger can either be your Stop Loss or your Target, and once your Target or SL is hit the other open order gets cancelled instantly. The moment your trigger price is breached, your order gets executed no matter if it’s SL or Target. The reason all Target orders are Limit is because we can’t have two SL orders. If you buy something at 100 and your Target 110, how can you place this as a market order? If you place a market order, it has to get exited immediately. For this reason, your Target order is Limit and SL is Market (after hitting trigger price).

You don’t need any additional margins to place Target and SL orders. They work with the base margin used for entering your position.

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