What is the difference between LTP and CMP? Also, how to execute a Buy limit order with a Sell Stoploss and Target? Will additional margin be blocked for this?

General
1

Hello

First of all I don’t want to use bracket/cover order. here is a scenario LTP:100, SL:97 TGT:105, buy only at 99 how to accomplish this with PI, which order to select? suggest me simplest method please.

2

hElLO tRaDeR,

Assuming CMP is at 100.

  1. You need to place a STOP LOSS BUY LIMIT order with trigger and price at 99. _ FOR ENTRY

Only after the order 1 is executed:

  1. Place STOP LOSS SELL LIMIT order with trigger and price at 97. _ FOR STOP LOSS

  2. Place STOP LOSS SELL LIMIT order with trigger and price at 105. _ FOR PROFIT BOOKING

Notes:

Placing orders 2 and 3 would require you to have extra margin than otherwise required.

Make sure you cancel the remaining of the order 2 or 3 , once the trade is closed.

3

Hello,

The answer by portfolioplus911 is incorrect on most levels.

Firstly, please note that LTP(Last Traded Price) and CMP(Current Market Price) are different.

LTP indicates the price at which the very last trade was executed. Here, you have chosen it to be 100 so lets assume it’s 100. This need not be the CMP. Say the best Bid and Ask prices are 99.80 and 99.90. So for a seller, the CMP becomes 99.80 and for a buyer, the CMP is 99.90. These values are not traded yet so it is not the LTP.

Having cleared that, with LTP now at 100 and best Ask price at 99.90, you can place a Buy Limit order at 99 to execute your buy position at 99 when the CMP reaches 99.

(Limit orders are best price orders, hence they are placed below CMP for your Best Buy and above CMP for your Best sell. Buy Limit orders placed above CMP and Sell Limit orders placed below CMP will be executed at the CMP because the CMP becomes the best price.)

You can either place a Sell SL or SL-M order at 97 as your stoploss and you can place a Sell Limit order at 105 as your target.

For more information on SL and SL-M orders, do read the following post:

http://tradingqna.com/51996/what-is-the-meaning-of-1-price-and-2-trigger-in-stoploss-

You can place a Sell Stoploss along with your Buy order as the Stoploss gets executed only after the Buy order is executed. This is not true for a Sell target. If you place a Buy entry order and a Sell Target order one after the other, then there is a chance that your Sell Target is reached first and you will now have a short position. Always place your Sell target order after your Buy entry order is executed.

As long as all the 3 positions are open, no additional margin will be blocked for the Sell Stoploss and Sell Target orders. If one of them gets executed, say the Sell Stoploss gets executed, then the Sell Target order will be treated as a New Sell Entry order and margin will then be blocked for it. In MIS trading, these orders have to be manually tracked on 2 levels:

  1. Placing your target order only after your entry order is executed.

2. Cancelling your Target or Stoploss once either of them are executed.

This can be automatized by using a Bracket Order.

Hope this helps, Good Luck!

 

7 Likes
4

thanks,just one confirmation, these kind of setup i guess not possible with bracket order as bracket order buy or sell on CMP, right?

5

You are right, Bracket order has 2 Product types; Market and Limit , but both of them executes the trade entry at CMP .