Track 'n Trade LIVE Stocks & Options

Video Transcript

In this video, I'm going to give you a demonstration of the quick custom orders of the QOS, as we call them. The first thing I want to do is bring you into a real-world example of how we might want to use these orders.

Now, we're in the stock version, and of course, we're going to come in and hit buy market. Let's say we're in the market with 100 shares, and we want to put a stop order behind the market. So, let's go ahead and put an order for 100 shares and a stop order behind the market.

Now, let's say we want to come up here and put a limit order in case the market rallies up and we want to take our profits as the market maybe approaches this high. So, we're going to come in here with a limit order, and we're going to try and drop a limit order up here in case the market wants to go up and hit our limit order. We go ahead and say we're going to sell at that level, but we get a failed error.

Okay, placing order failed. Could not place the Apple sell order; the sell order is for more shares than your currently long position. Please review your current position along with open orders for the security. So, we go ahead and say okay.

The reason it's not letting us do that is that we're long 100, and we already have a sell for 100. If we put a limit order in there, we would be naked with another 100. Now, our strategy is, well, obviously, if I get hit here—if I get stopped out—I'm going to take my 100 out of the market. Or, if I get hit with the limit, I'm going to take my 100 out of the market. The problem is it would leave the trailing order open.

Okay, so that would be left open. In the stock market, they don't let you do that. Now, in the Futures Market, they do; in the Forex Market, they let you do that. But in the stock market, they protect you, and they don't let you do that. The exchange will not allow you to put in a naked limit order to take that profit.

So, what we do is come in here, and I'm going to go ahead and delete this stop order. We can click that X button right there to delete it. Now, I'm going to right-click. Okay, I'm going to right-click on the order triangle, and I'm going to slide down here to add OCO.

Now, you'll notice when I do that, it gives me two orders, and they're connected to the mouse. As I move them up and down, you'll notice that I have a stop on the bottom and a limit on the top. So, now I can drop that on the screen, and now I can have my stop order, and I can move it independently.

So, I can place my stop order behind the market, and I can have a target limit order out above the market. If the market rallies up and hits the limit order, it's going to take my profits as it touches that limit order. Or, if it turns around and comes down and hits the stop order, it's going to stop me out and stop my losses.

Because it's an OCO, which stands for one cancels other, if it hits the stop order, it will automatically cancel my limit. If it hits the limit order, it will automatically cancel my stop. That's how we go ahead in the stock market and have both a stop and a limit.

Now, that said, let's go ahead and exit the chart. We're going to hit exit chart, and we're going to get out of this position. I'm going to show you the QOS. The QO—those are all programmable. Okay, they're quick customs, so they're custom orders.

You'll notice that we have some defaults in here for these QOS. The first one is a buy market, the second one is a sell market, the third one is a stop order, and the fourth one we've set to a limit order. But again, these are customizable, so you can go in and create your own strategies however you would like.

Now, I'm going to come in here and just very quickly give you an example of what this buy market, 5% stop, 10% limit is. So, we're going to go ahead and I'm going to right-click on that button, edit existing, and we're going to come in here. You can see this is the settings for that first button.

As we come in here, the first thing is just the name. That's all that is—it's a label. You can type in there whatever you want; it has nothing to do with the procedures that take place within the order itself. So, it's just something to give you a clue as to what this button does.

The next thing is we can come in here, and we're going to say this is a buy market, a sell market, a stop, or a limit. Of course, this one is set to buy, and we have this one set to 5% and 10%. So, our attached stop is going to be 5% back, and our attached limit is 10% back.

Now, of course, these are customizable. You can change that to whatever you want. This is just the default. Then, we can have that be percent, or we can have it be dollars back. So, with a simple click of the mouse, as you can see here with the buy market, we're going to go ahead and click the mouse.

We're going to confirm. Again, we could say, "Don't show me this again," if we would like. When we say okay, it's going to automatically set our entry, so we're in the market, automatically sets our trailing stop, and automatically sets our limit—all with a single click of the mouse, all with the programming that we put into this box.

Of course, you can create as many of these strategies as you would like.