Stocks & ETFs: orders and running trades

Updated: October 2, 20264 min read

1. Overview

For stocks and ETFs the OptionsApp uses a small set of fixed order types: entry and scheduled exit are market orders, and after the entry, profit target and stop loss are held as separate orders at Interactive Brokers. Trading only takes place during the regular session.

2. Entry

At the entry time, or when the trigger fires, the OptionsApp sends a market order for the quantity of the row, valid for the day (DAY) and with the routing chosen in the search (default SMART).

Before sending, the OptionsApp checks among other things whether the exchange is open and whether "Max. open Trades" of the strategy has been reached. If the order is only partly filled, the filled part becomes the running trade, and target and stop follow that quantity. If TWS does not confirm an entry order within two minutes, the OptionsApp cancels it and reports this.

3. Profit target and stop loss at the broker

As soon as the entry is filled, the OptionsApp places two orders with Interactive Brokers:

the stop loss as a stop market order (STP),
the profit target as a limit order (LMT).

Both are GTC (good till canceled), so they stay active overnight and over several days, and they are linked as an OCA group (one cancels all): when one is filled, Interactive Brokers cancels the other. The OptionsApp calculates the prices from the entry fill price and rounds them to the exchange's price increments. The stop is triggered with the double bid/ask method, which means only after the price has reached the stop level twice in a row.

If one of these orders is missing in TWS, the OptionsApp places it again. This also happens while the exchange is closed. After three failed attempts a warning is shown.

4. Exit

When a scheduled exit is due or an exit condition fires, the OptionsApp first cancels target and stop, waits for TWS to confirm and then closes with a market order. Before that, it checks that the account still holds the position. If the holding differs, it sends no order and reports the difference.

5. Regular session only

Entries, exits, direct trades and manual closes only take place during the regular session of the exchange. An exit that becomes due outside of it waits for the next open. The OptionsApp does not use pre-market or after-hours trading for stocks and ETFs, not even with the approval "Orders outside regular trading hours".

6. Restart and orders in TWS

Each order carries a reference in TWS. It starts with "OptionsApp: Equity Trade" and the number of the trade and names the kind of order, for example "Stop Loss Order". This is how the OptionsApp recognises its orders after a restart. Fills that happen while the OptionsApp is not running are recorded at the next start.

The OptionsApp does not touch orders it did not create. If a managed stock has orders from elsewhere, it reports them.

7. The "Stocks & ETFs" dashboard

In the dashboard, the "Stocks & ETFs" tab shows all trades: running, closed and the planned entries of the selected week ("TRADING WEEK", the current and the next three weeks). For each trade it shows, among other things, open price, stop ("SL"), target ("TP"), current price, result and status, for example PENDING for planned, RUNNING for running and CLOSED for closed. A dot on each row shows whether the stock's exchange is currently open.

The buttons above the table:

Trade log: shows every step of the selected trade.
Hand over: hands the selected trade over to the user (see section 8).
Close: closes the selected trade at once with a market order.
Direct trade: opens a trade immediately, without a schedule.
Holdings: shows the user's own shares next to the OptionsApp's trades (see section 8).

A direct trade is set up in the "Direct Equity Trade" window: stock, strategy ("ATTACH TRADE TO CONFIGURATION"), quantity (negative for short) and, if wanted, stop loss and profit target in percent. It counts towards "Max. open Trades" of the selected strategy and appears in the evaluation. It has no scheduled exit and ends through target, stop or a manual close.

Stock trades also appear in the evaluation under "Evaluations".

8. Own shares and hand-over

Shares already held in the account can still be traded through the OptionsApp. On the first entry in a stock, the OptionsApp records the existing position as the user's own shares and from then on keeps it separate from its trades.

If the account position changes from outside, for example through a purchase in TWS, the OptionsApp compares. If its own shares are still covered, it pauses the trades in this stock: target and stop stay at the broker, but nothing new happens until the numbers match again. If they are no longer covered, it hands the trades over to the user (status UNMANAGED).

The "Holdings" window shows for each stock what the OptionsApp holds ("App shares"), the user's own shares ("Manual shares"), the account position and the difference. "Take over difference" records a difference as the user's own shares, "Resume trades" lets the OptionsApp manage handed-over trades again.

A trade can also be handed over manually, for example to manage it in TWS. The OptionsApp then cancels its orders and stops managing the trade. How it was closed can be recorded afterwards with the same button ("Book closure"). As long as a handed-over trade is open, the OptionsApp does not open new trades in that stock.