Data Assumptions:
Label |
Value |
$26.31 - $26.32 |
|
Action |
Buy |
10,000 |
|
800 |
|
Subsequent Component Size | 400 |
$26.28 |
|
.02 |
|
Order Type |
Limit |
Create profit taking order | Check to enable |
Profit Offset | 0.20 |
The difference between this order and the order in Example 2 is that the Initial Component Size is larger than the subsequent component size by one full size. This feature works in conjunction with the profit taking orders, which we have enabled at an offset of $.20.
To understand the larger initial component, let’s first look at the mechanics of using the same component size of 400 with the $.02 profit offset. In this case, a BUY order would be submitted at the starting price of $26.28 and after it fills, the profit SELL order would be submitted at the component price + profit offset, or $26.48. When this fills, you have bought at $26.28 and sold at $26.48 for a profit of $.20 per share.
Now let’s look at the example above with the Initial Component of 800.
Scale Profit Orders with Initial Component topic.