Stop Loss Order (SL Order)


#1

I need help with Stop Loss order placement.

ASHOKLEY JUL 140 CE is at Rs.3 premium as of now. I buy 1 lot.
And now I want to place a Sell Stop Loss Order.
So I open the Sell section,
Select NRML, then SL
Quantity: 4000
Price: 2.70
TriggerPrice: 2.85

In Advanced Section, Regular and Day are pre-selected which I don’t change. (i.e. No Bo or CO or AMO, no IOC)

Now I would like to validate if my understand is correct.

When the Call option premium goes down from Rs. 3 to Rs.2.85 (Trigger Price), my sell order is activated. And if the premium keeps dropping and reaches Rs.2.70 (Price), then the sell order will be executed.

Is this understanding right?


#2

Your are spot on but let me tell you. Please don’t place sl orders in stock options . Often they get triggered due to noise in market and lack of liquidity. I have suffered this many times. Rather try to use sentinel alerts and decide according.


#3

Hi @sumitrekhi ,

In this case you have chosen a sell SL order, here once the trigger is reached the order will get executed at the best available price between the trigger and the limit price. If after the trigger is hit the price jumps below the limit price of 2.70, then the sell will not happen. It will remain pending till the price goes up within the range again.

Cheers,
Lindo


#4

Thank you