Order Type Query

S

ScoobyStoo

Hi All,

Please forgive me for asking a dumb question, but I'm fairly new to this game.

What type of order should I use if I want to enter a trade immediately but limit the max/min price that the order can be executed at?

Just as a very basic example, an instrument's spread is 100 - 101 and I want to enter long. However, the price is moving like a rocket and the spread is changing enormously. I have done my calculations and, taking into account my stop price, I have worked out that I can stay within my risk management tolerances as long as I get a fill at less than or equal to 104.

Up until now I have been using market orders but sometimes I have been getting fills at prices which mean I have busted my risk tolerances.

Gut instinct tells me I should be using some sort of a limit order with the limit price above the currently trading price.

What strategy should I use to get into the market immediately but limit the max/min price at which I can get filled?

Thanks in advance
 
Thanks very much.

That's what I thought but my spread betting company won't allow me to place a buy limit order when the limit price is above the current price (and vice versa for sell orders).

Is this a case of me having the right idea all along and my spread betting company just not supporting the order type I need to use?

Certainly sounds like it.
 
If you use a Buy limit order it must be below the market, and run the risk of not getting a fill if market keeps on going up

If want order above market use a Stop Limit order so if price is 100 - Put Stop at say 101 and Limit at 104. You can also miss the move if market gaps your order. No guarantees there
 
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