Tutorials for Conditional Orders Please

[Patrick Masters]

Hi Jerry. Finally got Ameritrade to remove the advanced features so I could use the conditional orders inside MedVed Traders. I was quite ecstatic to see it show up this morning when I launched MT. However, the excite quickly dissipated as I tried to make heads and tails. The first jarring thing is that switching to any conditional order takes away the buy/sell/short/cover buttons I have become accustomed to. 

Next, while hovering over each of the OTA/ OTOCA, etc... tells me what type of conditional order each tab represents, it kinda stops there. At that point, I have zero idea on whether I should use same, Reverse for actions etc... I am not sure what my expectations were but I am pretty sure this isn't what I had expected. I am almost embarrassed to say that ThinkorSwim makes it easier especially since I prefer to scale out of trades using predefined 2:1 or better rewards-to-risk ratios.

Is it possible to maybe add another tab that could allow those of who scale out of trades to define our stop loss and then input our preferred ratios for reward to risk (i.e. mine are 1st target 2:1. 2nd target 3:1 and 3rd target is my lotto shares at 6:1 or better)? I have added a screenshot from TOS of how I have it set up now and also how I have save various order templates based on where I have to set my stop losses.

 

Also another style I trade when I am not using defined RR targets is sometimes if I feel a trade can exceed these targets, I may open a position and sell off half and then raise my stop to Buy price and essentially make it a free trade. Perhaps I have overlooked the correct way or I am doing it wrong, but the process I follow now is 1/2 my position, sell market then I have to reset my stop limit. Is it possible to program MT that upon selling a partial position that we can automatically move our stop loss to our Buy price  or Buy price + $.01? The reason I ask is because when I used DAS Trader Pro last year, I was able to configure Keyboard shortcuts and buttons that would accomplish this very task. 

 

My overall goal is to minimize the amount of clicks and/or keystrokes that allows me to get into a trade more quickly and take profits just as quickly as I need to. if we were able to have the ability to add hotkeys/shortcuts and have the ability to turn them into buttons like DAS Trader pro, it would make MT even more valuable to me. 

 

Also,  if you have some free time, could you make some tutorials that actually break down each OTA, OTOCA, OTOTA, OTT actually do and maybe provide some examples in which scenarios they should be used?

 

Sorry to be a pain in the ass but I am trying really hard to minimize any reason to ever fire up the RAM and resource hog that is TOS ever again. Any help at this point would be greatly appreciated. 

 

[Soundwave401]

There is list of keyboard shortcuts you can view and edit to your liking in the settings. Click File > Settings > Application > Keyboard shortcuts. . Alt+F (Flatten) is my favorite feature when trading leveraged ETF's. It'll instantly cancel all standing orders and sell all shares at market. It's the most common way I exit trades when day trading. In not so volatile equities I just use the bracket order when I'm day trading so I can set my stop and sell limits as soon as I enter the trade.

As far as the OCO orders I concur. I've struggled to figure them out as well. I like the ideas you listed above, hopefully Jerry can add some insight.

Edited March 25, 2020 by Soundwave401

[Patrick Masters]

Thanks for the response, Soundwave. What I am referring to as far as keyboard shortcuts is the ability to create hotkeys for specific orders and types like I could do in DAS Trader Pro. For example, I can set up a hotkey and convert it to a button where one click buys 1000 shares at market price, sets a .25 stop loss, and a target of $2.00 Then I can duplicate and change stop losses and target to a new button. I appreciate the shortcuts Jerry has provided us but I really love the ability to create shortcuts rather than just assign hotkeys to predefined shortcuts. 

[Patrick Masters]

I guess Jerry doesn't frequent here much anymore. I hope he is ok health wise and has stayed safe from the coronavirus. If I can't figure out how to use conditional orders or be able to use them the way I envision, not sure what good MT brings me other than more aesthetically looking charts compared to ThinkorSwim. Hopefully I can  get some sort of response before my next renewal date or this might be my last month I am with MT. Fingers crossed.

[Jerry Medved]

sorry about the delay - didn't have time to read it all at the time it was posted, and then got swamped and forgot to come back...

the way the conditional orders work is that there is the main order - the one you enter on the main area of the trade ticket, and then the conditional parts.  The "Action" of the conditional part is in relation to the main order. Note that we do have a mouse-over tooltip for that

Example 1: OCA order (same as Bracket) to SELL BAC 100 LIMIT at 23.50 and STOP MARKET 2.50 below that (at 21.00)
the action on the conditional leg is "Same" meaning it is the same direction as the main order, or SELL in this case:

Example 2: OTA order (One Triggers another) to BUY 100 LIMIT at 21.50, SELL STOP MARKET 5 % below (20.43) :

Example 3: OTOCA order (One Triggers OCA) to BUY 100 LIMIT at 21.50, then SELL LIMIT 2 points above (at 23.50) and STOP MARKET 1.50 below that (at 20.00)

Example 4: OTOTA order (One Triggers One Triggers Another) BUY 100 LIMIT at 21.50, then SELL LIMIT at 23.50, then buy again 1.50 below that (at 22.00)

As you can see the Action (SAME or REVERSE) is always relative to the main order. If you select BUY on top, SAME will mean BUY, REVERSE will mean SELL. If you change it to SELL ... well, you get the idea.

Since the prices on the conditional legs are relative, if you change the limit price on the main order, the conditional leg prices will adjust accordingly and you can see that in the price shown above the price field. Also, if you have MT set to confirm the orders, then when you get the confirmation, MT shows the actual order that will trigger. For example:

 

Shortcuts - We will be adding saved orders, which will allow you to assign a shortcut to the saved order, which will do what you suggest. In the meantime, you can specify Bracket high/low settings on SETTINGS / TRADING / ACCOUNTS - select account and then look at the PRICE tab on the bottom right.  That also applies to selecting high/low values in various conditional orders. 

NOTE: we do not auto send anything. We send the conditional order you specify to the broker, at which point we have no further interaction with the order. Right now in MT all conditional order legs are for the same quantity. And you cannot specify 3 legs as in your TOS example. The API for most brokers does not support that, including TD Ameritrade API (TOS uses completely different stuff)

Also, in case of TD Ameritrade specifically, the conditional orders cannot be edited. Have to cancel/resubmit. Their restriction, not ours.

[Patrick Masters]

Thanks, Jerry. As always, excellent explanation that helped me understand it more clearly. 

[Mike Medved]

I am putting Jerry's post into our help file.

[Doug Hayman]

Hey guys,

Quick question - assuming that I'm dealing with Limit OTOCA orders on the DOM, and I enter an order with a Limit Price with corollary Profit and Stop Legs, and trade is not filled yet.   Is there a way (shortcut-wise), that I can move the Limit price on the DOM, and have the associated Profit/Stop prices adjust up or down by the same amounts, so that I don't have to manually adjust the Profit/Stop prices with secondary mouse actions?

Thanks in advance

[Doug Hayman]

P.S.  on prior post,

I realize that I can cancel current order and re-enter order on DOM (2 keystrokes), which isn't horrible.  Not sure if you maintain order context in MT, after submitted to broker.

[Jerry Medved]

Right now - no other way. will have to see if we can do something.

 

[Doug Hayman]

OK thanks.

[Doug Hayman]

Along the lines of Patrick Master's Risk/Reward question/request above, would it make sense to add a pre-defined MT order type (call it RR) that facilitated scaling out of positions, since most brokers don't support this natively?

Maybe up to 4 levels of pre-defined Limits and Stops legs could be defined, requiring QTY % (applied to current instrument position size) AND either % or points for price level (consistent with your current implementation).

Example:

I use either a LIMIT order OR a LIMIT OTOCA order to buy 4 future contracts.  If OTOCA is used, I cancel the 2 corollary leg orders created when I feel comfortable to do so.

I select RR trade type and based on the Leg settings and the price of execution of this trade, up to 4 Limit Orders and up to 4 Stop Market orders are automatically (that is, individually) created, with size of each proportionate to the QTY % for each Leg stipulated above.

Using the DOM, it would be 2 keystrokes max: one to cancel the OTOCA order legs (if this order type were used), and one to create the RR order.

Does this make any sense to do?

[Jerry Medved]

We do not want to manage the order. We generally avoid it at all costs. There are very few exceptions, like Order Modify in situations where the broker does not support it natively, or FLATTEN/REVERSE, but in those cases the management is very brief and predictable. And even there we've run into a problem. Definitely do not want to be responsible for the order combinations you described.

[Doug Hayman]

Jerry, is my suggestion really “managing an order”?  I’m not suggesting that this implementation would be easy, but only order requirement would be understanding the open position size for determining QTY % at each level. Basically, in my example, it would require firing off 4 Limit Orders and 4 Stop orders to broker. After that the user would manually manage these open orders via MT. 

OCA, OTOCA, etc have been excellent enhancements to MT. But “scaling out” of trades is cumbersome, esp in faster-moving markets.  If you can suggest easy ways to accomplish this that I may be missing, please let me know.

Thanks again.

[Jerry Medved]

oops, OK, if individual orders, that would not be managing. I thought that the OCA type relationship would have to be maintained by us since most brokers do not support such multi-leg OCAs. 

Either way, right not that is not feasible - not so much because of difficulty implementing the order itself, but rather because of the user interface changes involved. We are working on our API though, so once that is released, could write your own, or have various 3rd party add-ons that do that.

[Doug Hayman]

ok. What’s your ETA on the API?

[Jerry Medved]

don't know. just started.