Crypto thread

Stop on quote and stop limit on quote orders

Stop on quote and stop limit on quote orders are orders that have "triggers" (i.e., events that are required to occur for the order to be sent to market). Therefore, they execute only when the stock's applicable quote reaches the stop price. These orders are most commonly used to protect a gain on a profitable long or short position, which is why they're frequently referred to as "stop loss" orders. Please note, "triggers" may vary for over-the-counter (OTC) securities. 

When you place a stop on quote order, you're placing an order that will turn into a market order when the bid/ask price is equal to or lower/higher than the stop price you have specified. Note, the price at which a stop on quote order executes may be at, below, or higher than the stop price depending on the time the order reaches the marketplace, and it may execute at a price considerably different than the trigger price in unusual market conditions and thinly traded securities. 

For example, let's say a stock you own is trading at 55, and you place a stop on quote sell order at 50. When (and if) the stock bid price goes down to 50, your order will turn into a market order and fill at whatever the current price is when your turn comes up in execution. This could be 50, or higher, or lower.

Day, GTC and GTD orders

One of the things you'll need to decide when placing an order is how long you want it to remain open. This is called the "duration" or "term" of the order. For most price types, you'll have multiple choices: you can specify good for the day ("Day"), good for 60 days ("Good Until Canceled" or "GTC"), or good until a date of your choosing ("Good Until Date" or "GTD"). Market and limit orders are the exceptions. Market orders can be placed only as day orders, while limit orders offer additional options such as "immediate or cancel" and "fill or kill."

One-Cancels-All orders

A One-Cancels-All order is an order group made up of two or three individual orders. When any one of the orders in the group meets a trigger condition, it will be sent to the market center and the other order(s) will be automatically canceled. 

This type of order can be used for the same purposes as a bracketed order. However, given the flexibility to choose between stock and options orders within the One-Cancels-All framework, there are a variety of other uses for this order. For instance, imagine you want to enter into a position in either a particular stock or an option in that stock. You place a One-Cancels-All order group made up of the following orders:

§  Order #1 – Buy stock ABC at a limit price of $14.50. ABC is trading at $16 per share at the time you place your order.

§  Order #2 – Buy option XYZ at a limit price of $0.75. XYZ is trading at $1 per contract at the time you place your order.

If the price of option XYZ falls to $0.75 before ABC hits $14.50, Order #2 will be triggered and sent to the market center as a buy limit order. At the same time, Order #1 will be automatically canceled.

I pasted some terms above you need to know. I took out a bunch of unnecessary stuff.  

But you need to make sure:

1) you get in at where you want to get in. 

2) you have it set to get you out in case it goes the wrong way. 

3) you have it set to get out at where you think your good profit would be

4) make sure it is a one-cancel-all order or whatever Robinhood calls it

With options you have to have the stops and limits in place or you may lose a lot of potential profit or you could lose way more on the trade than you want to.  

This is not like buying a stock and just holding it — these have intrinsic value and a time premium.  

I am still confused at what you actually bought? 190 puts?  Those are the only ones that traded at 2.10 at anytime today it looks like — unless I misunderstood what you did, which is very likely.

HD April 17 190 puts 

opened at: 1.66 

high has been: 4.71

currently: 4.10

So you sold at 2.68 ?

This last one I hopped into is 

HD $180 put 

1 buy $2.10 

currently at $2.24 +$14 

So I can pick any time between now and April 17th to sell this? 

If it goes to $4.00 today or $4.00 on the 15th it’s the same? 

Home Depot was trading at $214 in December. While the Dow was around 28,000 and no talk of corona. 

Now it’s trading at $195 in the middle of the corona pandemic. 

It dropped down to $152 on March 20th. 

I mean ... am I missing something here? 

One thing that I can’t really wrap my brain around is I entered this when HD was $195. Now it’s $192 and I’m -$10. 

A little explanation on why that is would be helpful. 

Yes, you can wait or sell anytime between now and then.  But with options you have to have a buyer at your price.  Some stocks don’t have a lot of volume each day.  If you had the 190 puts the number today that traded were 306. 

Closed at 5.30. So did you buy these at 2.10 and sold them at 2.58?  If so — you could have had a buy order in at 4.5 or 5.00 and more than doubled your money.  Still any profit is good.  

If you bought at 2.10 and sold at 2.68 for a $58 profit. Then no way you are down $10 unless you have outrageous commission on option trades — or you are counting this other trade if it is negative for the day?

While the stock goes up the calls generally go up and the puts go down and vice-versa.  But this is not always the case and they are not exactly tied to it by ratio or anything.  So, don’t let that throw you off too much.  Some days a stock may be up and most puts will be down and some puts will actually be up.  

There are a LOT of factors.  

Ok, got it. I see that this usually corrects from the time I’ve spent watching. 

Thanks for the help guys. Learned a little bit today. 

So now you bought HD April 17 $180 puts @ 2.10

right?

Yesterday close at 2.75

low today .44

high today 2.54

close today 2.22

So, you bought toward the high end — but that fine if it moves your way.  Because we saw them trading over 10 last week.

So now — make sure you go ahead and place your sell order!!  Have that set up before the market opens in the morning!!

Ok, got it. 

This MGM stock really has some nerve pumping the way it. They depend on big crowds and people willing to throw their money down the toilet. 

That’s a BAD combination for the corona recession. 

I’ve got my eye on them.

Note, not all options can be sold before the maturity date.

The key difference between American and European options relates to when the options can be exercised: A European option may be exercised only at the expiration date of the option, i.e. at a single pre-defined point in time. An American option on the other hand may be exercised at any time before the expiration date.

34 days until the bitcoin halving 

Are we taking a flyer on USO hoping for a deal between the Saudis and Russians or what 

All optional stocks and ETFs are American-style options — so, any stocks and he is fine.  Usually only have to worry about this with some of the indices. 

With stocks he is fine. 

So for puts for 4/17 

Whats the difference between a $345 put and a $80 put and that entire range 

I got a warning that I could be labeled as a day trader and then I can only trade if I have $25k+ in Robinhood account 

Yeah you free rode and they tagged you. Most margin accts or options trading accts have that 25k requirement.

How in the world would they even allow a single margin trade anyway? I have accounts with Vanguard and TD Ameritrade and the requirements must be met along with an online application. 

This sort of activity makes me very suspicious of RH. They have the potential to be totally blindsided by a group of clients on any particular day getting a margin call without the liquidity to back it up as collateral. Trading this way isn't for rookies. 

They sell crypto and I can’t deposit bitcoin to add funds to my account. I think that’s silly. 

USO $6 call 4/17 

18 contracts 

Avg cost $0.15