How you manage getting stuck in a halt

C

cherubian

Just curious what some of the other equity traders do when they have a position on and it gets halted.

In the past I have avoided news stocks, but may be looking at playing the news-driven stocks each day and will expect to get stuck in halts from time to time.

Since I generally trade without hard stops, for news blowups first thing I do after noticing fast moving P&L is over-hedge my position with a highly correlated stock, then see if I can figure out how bad the news is and try to get out of my position at a decent price.

Any other suggestions or ideas would be appreciated. Thanks.
 
If I knew nothing about the stock, strictly trading off the chart and you're stuck in a trading halt. Close out or hold?

The first thing I would do is know where you are in relation/days to option expiry (if the stock has options). Then make a determination of probability of equity hitting likely strike price, or closing in between two strikes.

Options could drive the underlying.
 
If you are in a stock when it gets haulted...you are stuck in the stock until it starts trading again

Quote from cherubian:

Just curious what some of the other equity traders do when they have a position on and it gets halted.

In the past I have avoided news stocks, but may be looking at playing the news-driven stocks each day and will expect to get stuck in halts from time to time.

Since I generally trade without hard stops, for news blowups first thing I do after noticing fast moving P&L is over-hedge my position with a highly correlated stock, then see if I can figure out how bad the news is and try to get out of my position at a decent price.

Any other suggestions or ideas would be appreciated. Thanks.
More...
 
Don't have an overly large position in any one stock and then - assuming this is going against you - try and gauge how bad the news really is before you sell when it reopens; lots of times, there will be an overreaction.
 
I was in CTB not that long ago when it was halted....i just sat on my hands and waited for it to resume trading. I trade pairs and can hold some positions for a long duration, before you get into trading you have to quantify the risk to potential risk if you're in x amount of shares and it moves x% points against you relative to your account equity. I wasn't in a very big position so the move didn't have a major impact on my day's p&L.
 
Quote from cherubian:
Just curious what some of the other equity traders do when they have a position on and it gets halted.
More...

Long term survivors ask a different question -- How do I NOT having to manage a position that can get halted.
 
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