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Stop loss on open position - Possible?


Martinius

Question

I have opened positions on a couple of US shares.  I want to set a stop loss but I can't see anywhere to set one. Eventually after hours of looking I found that you cannot set a stop loss.

I note from a reply from many years ago (August 2016) that you cannot put a stop loss on an open position.  It stated: On a share dealing account, you cannot simply attach a stop/limit OTC, but rather have to work a stop or limit order on the exchange to close a position.  Therefore, if you have a level at which you would like to close a position, you need to enter a sell order to work in the market, until the price is reached and as many shares are sold as possible.  Is this still the case?

This brings up related questions. 

If I have bought the shares at $100 and want to sell if the price goes down to $96 Do I put in an order to sell at $96?

If the price goes up to $105 and I wish to sell, do I have to amend the existing order to sell at $105 rather than $96?

Could I get into a mess if I tried to put in an additional sell order @ $105 as well as the one at $96? - in which case I would have two different orders trying to sell the same shares.

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14 hours ago, Martinius said:

I have opened positions on a couple of US shares.  I want to set a stop loss but I can't see anywhere to set one. Eventually after hours of looking I found that you cannot set a stop loss.

I note from a reply from many years ago (August 2016) that you cannot put a stop loss on an open position.  It stated: On a share dealing account, you cannot simply attach a stop/limit OTC, but rather have to work a stop or limit order on the exchange to close a position.  Therefore, if you have a level at which you would like to close a position, you need to enter a sell order to work in the market, until the price is reached and as many shares are sold as possible.  Is this still the case?

This brings up related questions. 

If I have bought the shares at $100 and want to sell if the price goes down to $96 Do I put in an order to sell at $96?

If the price goes up to $105 and I wish to sell, do I have to amend the existing order to sell at $105 rather than $96?

Could I get into a mess if I tried to put in an additional sell order @ $105 as well as the one at $96? - in which case I would have two different orders trying to sell the same shares.

Hi @Martinius

That is correct. 

For a stop order on a share dealing account, placing a stop order would work a stop order in the market. Once the trigger level reaches, it works at market until full size is filled. Please kindly note that once the stop level is triggered and your sell order works at market, the aim of the order would be to fill your full size and would give you a price at market. If you choose the level $96 and the market reaches $96, it either sells all your shares at $96 depending on the volume or starts to close your position at the next available price until the full size is filled. 

Using your example, depending on the length of time the order will be in the market for, if you want  to sell if the price goes down to $96, you have to place an order to sell at $96. If the price goes up to $105 and you wish to sell at the new price, you would have to amend the existing order to sell at $105 rather than $96.

It would not be possible on a share dealing account to place two sell orders. This would give you the rejection reason "you are selling more than you currently own". 

All the best, OfentseIG

 

 

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