Trailing Limit if Touched
A trailing limit if touched order is entered on the same side of the market as a limit order. This order will initially be set at a price level that is favorable to the current market. As the market moves away from the initial trigger price, the user defined trailing amount and limit offset amount will adjust the trigger price and the limit price to follow the market. If the initial market movement is in a favorable direction and reaches the initial trigger price, the order will be triggered and submitted as a limit order. If the market moves in an unfavorable direction, the order will trail the market movement and will trigger only if there is retracement by the defined trailing amount (for falling markets, retracement is when the market declines followed by an increase to levels previously traded; for rising markets, retracement is when the market rises followed by a decrease to levels previously traded).
Buy Order
A buy trailing limit if touched order moves with the market price, and continually recalculates the trigger price at a fixed amount below the market price, based on the user-defined "trailing" amount. A trailing limit if touched order is similar to a trailing stop limit order, except that the buy order sets the initial stop price at a fixed amount below the market price instead of above. As the market price rises, the trigger price rises by the user-defined trailing amount, but if the price falls, the trigger price remains the same. When the trigger price is touched, a limit order is submitted.
Sell Order
A sell trailing limit if touched order moves with the market price, and continually recalculates the trigger price at a fixed amount above the market price, based on the user-defined "trailing" amount. A trailing limit if touched order is similar to a trailing stop limit order, except that the sell order sets the initial stop price at a fixed amount above the market price instead of below. As the market price falls, the trigger price falls by the user-defined trailing amount, but if the price rises, the trigger price remains the same. When the trigger price is touched, a limit order is submitted.
| Products | Availability | Routing | TWS | ||||
|---|---|---|---|---|---|---|---|
| Bonds | US Products | Smart | Attribute | ||||
| EFPs | Non-US Products | Directed | Order Type | ||||
| Forex | Time in Force | ||||||
| Funds | |||||||
| Futures | |||||||
| FOPs | |||||||
| Options | |||||||
| Stocks | |||||||
| Warrants | |||||||
| Open Users' Guide | |||||||
Notes:
The Reference Table to the upper right provides a general summary of the order type characteristics. The checked features are applicable in some combination, but do not necessarily work in conjunction with all other checked features. For example, if Options and Stocks, US and Non-US, and Smart and Directed are all checked, it does not follow that all US and Non-US Smart and direct-routed stocks support the order type. It may be the case that only Smart-routed US Stocks, direct-routed Non-US stocks and Smart-routed US Options are supported.
Example
Order Type In Depth - Trailing Limit if Touched Buy Order
Step 1 – Enter a Trailing Limit if Touched Order
You want to purchase 100 shares of XYZ in a rising market. You decide to create a trailing limit if touched order with the trailing amount $1.00 below the current market price of 61.44.
To do this, first create a BUY order, then select TRAIL LIT in the Type field. As soon as you select TRAIL LIT as the type, the Trigger Price and Limit Offset fields appear. Enter 1.00 in the Trailing Amt field. The trailing amount is the amount used to calculate the initial trigger price. Then enter 0.10 in the Limit Offset field. The Limit Offset is used to calculate the limit price (for a buy order, Trigger Price + Limit Offset = Limit Price). Submit the order.
| Assumptions | |
|---|---|
| Action | BUY |
| Qty | 100 |
| Order Type | TRAIL LIT |
| Market Price | 61.44 |
| Trailing Amount | 1.00 |
| Trigger Price (Calculated as Market Price – Trailing Amount) | 60.44 |
| Limit Offset | 0.10 |
| Limit Price (Calculated as Trigger Price + Limit Offset) | 60.54 |
Step 2 – Order Transmitted
You transmit your order. The current market price of XYZ is $61.44 and the initial trigger price is calculated as $60.44, or $61.44– the trailing amount of 1.00. The limit price is calculated as 60.54, or the trigger price + the limit offset of 0.10.
| Assumptions | |
|---|---|
| Action | BUY |
| Qty | 100 |
| Order Type | TRAIL LIT |
| Market Price | 61.44 |
| Trailing Amount | 1.00 |
| Trigger Price (Calculated as Market Price – Trailing Amount) | 60.44 |
| Limit Offset | 0.10 |
| Limit Price (Calculated as Trigger Price + Limit Offset) | 60.54 |
Step 3 – Market Price Rises
As soon as you submit your order, the price of XYZ starts to rise and hits $62.00. The trigger price has adjusted accordingly and is at $61.00, or $62.00 – the $1.00 trailing amount. The limit price has also adjusted accordingly, and is now $61.10, or $61.00 + the limit offset.
| Assumptions | |
|---|---|
| Action | BUY |
| Qty | 100 |
| Order Type | TRAIL LIT |
| Market Price | 62.00 |
| Trailing Amount | 1.00 |
| Trigger Price (Calculated as Market Price – Trailing Amount) | 61.00 |
| Limit Offset | 0.10 |
| Limit Price (Calculated as Trigger Price + Limit Offset) | 61.10 |
Step 4 – Market Price Falls
Suddenly the market price of XYZ drops to $61.50. Your trigger price remains at $61.00 and your limit price remains at 61.10. If the market price continues to drop and touches your trigger price, a limit order to buy 100 shares of XYZ at the last calculated limit price will be submitted.
| Assumptions | |
|---|---|
| Action | BUY |
| Qty | 100 |
| Order Type | TRAIL LIT |
| Market Price | 61.50 |
| Trailing Amount | 1.00 |
| Trigger Price (Calculated as Market Price – Trailing Amount) | 61.00 |
| Limit Offset | 0.10 |
| Limit Price (Calculated as Trigger Price + Limit Offset) | 61.10 |
Step 5 – Market Price Touches Trigger Price, Limit Order Submitted
The market price of XYZ continues to drop and touches your trigger price of $61.00. A limit order to buy 100 shares of XYZ at $61.10 is submitted.
| Assumptions | |
|---|---|
| Action | BUY |
| Qty | 100 |
| Order Type | TRAIL LIT |
| Market Price | 61.00 |
| Trailing Amount | 1.00 |
| Trigger Price (Calculated as Market Price – Trailing Amount) | 61.00 |
| Limit Offset | 0.10 |
| Limit Price (Calculated as Trigger Price + Limit Offset) | 61.10 |
| Limit Order submitted | |