I placed my first "conditional" buy order today with Etrade. Basically, whatever stock hits my target first gets executed. I don't have a lot of time to watch the market this week so this will save me some hassle.
I have up to $1150 I want to spend on either of two companies so I set a "One Cancels All" buy order for CVX and OMI. If OMI hits 28.01 , 40 shares will be purchased and the order for CVX cancelled. If CVX hits 100.01, 11 shares will be purchased and the order for OMI will be cancelled.
Another benefit of this strategy is that I need less cash on hand. I only need to keep cash of $1150 in my account for this order as opposed to twice that amount if I had two separate orders.
Has anyone else placed conditional orders? Etrade has 5 categories: Bracketed, Contingent, One-Cancel-All, One-Triggers-All, One-Triggers-OCO. I will be exploring some of these options in the next few months.
Interesting. I don't think my brokerage has that capability. If I don't have much money and I'm interested in two stocks but can only buy one, then what I typically do is just set a limit order for whichever stock is closest (percentage-wise) to my target price.
ReplyDeleteThat's what I was doing until I noticed the conditional orders. It will actually let me add a 3rd or 4th stock to the One-Cancels-All order. I suppose this might be good if I was on vacation or not going to be watching the markets for an extended period of time. The Conditional-contingent order allows you to place an order contingent on another stock or fund's value. For instance I could place an order to buy 10 CVX when SPY is less than 130.
ReplyDeleteI have a feeling most of these advanced conditional orders are more for people that buy on technicals and not fundamentals.