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Trade Plans
Adding Shares to an Existing Order 		Last Activity 1/2/2025 4:50 PM
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Vinay

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Subject : RE: Adding Shares to an Existing Order
Posted : 9/24/2013 1:04 AM
Post #28830 - In reply to #28356
1. In the Paper Portfolio under Open Positions multiple orders each with its own entry price is there but the problem is that the Trade Plan calculates the Stops based on the Ist Order Rate, not on the average of all the Orders of a single Stock. Is there a way out to force Trade Plan to calculate Stops on the average price? This can be important if subsequent position is entered at a significantly different rate.

2. I have noticed that if I first remove the Trade Plan, then go to Open Positions tab under Portfolio and Edit Position and making necessary changes to the quantity and rates, then reapply Trade Plan then it calculates the Stops correctly on the entire position including additional shares. So instead of the method suggested by you earlier in this post to add shares to an existing position, can this alternate method be used? Are there any downsides to this method which I am missing?
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Barry Cohen

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Subject : RE: Adding Shares to an Existing Order
Posted : 9/24/2013 12:01 PM
Post #28833 - In reply to #28830
I see. I'm not sure that an average is the way to do that. What if your first position has 1000 shares & the 2nd has 5 shares, or vice versa? Your alternate solution by editing the position to add shares is fine, but I don't believe it calculates the stops according to an average, I believe it calculates off the price you gave it when making the edit.
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Jim Dean

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Subject : RE: Adding Shares to an Existing Order
Posted : 9/24/2013 12:24 PM
Post #28834 - In reply to #28833
I agree with Barry. I'm not sure what you mean by "rate", but I am familiar with scaling-in and out, am very familiar with various means of setting stops. If you're referring to a simple fixed-loss stop, then if you are using a similarly-simple fixed number of points as the offset, I suppose a weighted average entry price might be appropriate.

But if you're using a stop with any degree of sophistication at all, such as ATR-based, or a dynamic stop such as trailing profit or chandelier, etc, then there's a lot more to it than just the entry price.

Further - part if the reason for scaling in is often due to initial uncertainty of the move. If you're adding to the position, then that would imply the direction had been subsequently confirmed. This usually means to me that the certainty is greater, and would allow for somewhat tighter stops.

But generalizations are nearly useless - stop logic is highly related to the kind of trade being taken. I think N's approach is a good one. It sticks with the initial plan unless you explicitly change it.

Jmho fwiw.
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Vinay

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Subject : RE: Adding Shares to an Existing Order
Posted : 9/25/2013 12:49 AM
Post #28853 - In reply to #28833
Originally written by Barry Cohen on 9/24/2013 11:01 PM

I see. I'm not sure that an average is the way to do that. What if your first position has 1000 shares & the 2nd has 5 shares, or vice versa?


I want to use weighted average rate not simple average rate which you seems to be implying.

Your alternate solution by editing the position to add shares is fine, but I don't believe it calculates the stops according to an average, I believe it calculates off the price you gave it when making the edit.


While editing I am putting total quantity including the additional quantity bought and in the rate column I am putting weighted average rate for the entire quantity. So in effect the Trade Plan takes the weighted average rate as entry price and calculates the Stops accordingly.

[Edited by Vinay on 9/25/2013 12:55 AM]

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Vinay

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Subject : RE: Adding Shares to an Existing Order
Posted : 10/10/2022 8:26 AM
Post #48721 - In reply to #28356
Barry,

This thread is 9 years old. Has anything changed during this period from what is mentioned here?


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Barry Cohen

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Subject : RE: Adding Shares to an Existing Order
Posted : 10/12/2022 9:16 AM
Post #48724 - In reply to #48721
Nothing has changed in regards to this thread, no.
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