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This would occur regardless of your trailing stop calculation. If you had also set up a profit exit of 10% and a loss exit of 3% in conjunction with your trailing stop exit, the bracket would trigger at either 3% below the execution price or 10% above that price if met. 7 (5% of $14) and the order is triggered. Conversely, the stock might not hit resistance until $14 before it drops.
![streetsmart edge adding brackets to spread orders streetsmart edge adding brackets to spread orders](https://insidebitcoins.com/wp-content/uploads/2020/03/Screenshot_1600.jpg)
The worst case scenario is that the exit order would go out at $9.50 because it simply never gained on the execution price. 5 points per share) from the execution price, the trailing stop would place an order to close your position only if the stock price loses 5% from its highest gain. If either of the profit or stop loss exit prices are met, the bracket will trigger regardless of any trailing stop you may have set.ĮXAMPLE If you bought a stock at $10 and wanted to protect yourself should the market move against you 5% (or. If you use a trailing stop exit in conjunction with a profit and/or loss exit, the trailing stop will operate between these two exits. The value can be a certain number of points or a percentage of the execution price. This exit is valuable in helping you retain portions of your gain in a position before closing it out.
![streetsmart edge adding brackets to spread orders streetsmart edge adding brackets to spread orders](https://slickbucks.com/wp-content/uploads/2017/03/trading-process.png)
The value can be a certain number of points (pts) or a percentage change from the execution price, or the exit price itself.ĮXAMPLE If you bought a stock at $10 and wanted to exit the position at $12, you could enter 2 pts, 20%, or $12.
#Streetsmart edge adding brackets to spread orders software#
Using brackets, you can predefine profit and loss targets for trades so that if those targets are met, the software will automatically send an order to exit the position. This can help you integrate your risk management strategy directly into the creation of an equity or option order. Brackets are profit or loss exits you can attach to your stock or option orders when you place a trade.