entry1

Disclaimer – This example was selected for the demonstration provided below. These trade setups happen all the time and on every chart but your results may vary. You should always do your own due diligence before making investment decisions and/or consult a registered financial advisor. This page is not a recommendation for you to buy or sell any securities or attempt the information provided. It is for education and entertainment purposes only.


Options Order Entry Explained

 

With the hardest part behind me I can now send the order to my broker and execute the trade.

 

Be warned… Its easy to slip up and lose focus at this point. A mistake here basically negates everything prior to this point… the research… the days waiting for the perfect setup… all for nothing because the wrong order was executed.

 

Pay attention! Its that easy… check and double check the desired order before pressing confirm and send.

 

Order Entry Details

Contract: March 2016 $47 Call Option

Strategy: Long Call position

Premium: $.97 cents

Outlook Duration: Short term ( 1 – 10 days)

Days to Expiration (DTE) – 31 days

Profit Target: Unset – Manually close

Loss Target: $.77 cents

 

I realize this seems like a ton of information to monitor and in reality it is. But after placing a few trades and getting comfortable with whichever brokers software you choose, it’ll become second nature. I promise.

 

To place the trade right click the order that corresponds with the desired contract and the desired long or short position. For this example I’ll right click the ask column at the $47 strike. See image below.

Click to Enlarge.

Entry Steps
Buying Mar 16 Call

 

Once buy > Single has been selected this box will appear.

 

Click to Enlarge.

Order Entry
Order Details

 

At this point I have to determine what type of order I wish to conduct. Limit, Market, Stop, Stop Limit… With so many options selecting one seems overwhelming but it’s not and honestly I can’t remember ever using anything other than Limit orders. For more information on order types click here.

 

For this example, I’ll select a Limit Order.

 

I also need to decide time in force (TIF) which is simply telling the broker how long this trade should say in the order queue. DAY means until the close of trading that same day. GTC means until its manually cancelled or something like 6 months.

 

For this example, I’ll leave TIF set at DAY.

 

I typically leave the Exchange box alone and leave BEST exchange selected.

 

If everything looks good… I can place the trade!

 

Click confirm and send. Review the order details on the next screen. Click send again.

 

Now… my account looks like this. Click to Enlarge.

Active Trade
Live Trade

 

Congratulations! You’ve just viewed, in its entirety, the placing of an options trade. At this point I just need to monitor the position.

 

On the next page we’ll look at some exit criteria. Let’s not lose focus here as exiting the trade is the absolute most important of all the steps. Why? Its where I try to take money out of the market and put it in my account. Or maybe leave some behind, which I hate. 🙁


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Exit the Trade