VPS Share - Good broker... Better plans... Best pricing...
- Thread starter Qreous
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The below is from VPS cover order e-mail..........
FAQ ON COVER ORDER
What is a Cover Order?
Cover Order is a feature that helps you get more leverage while taking an intra-day position in Nifty, Bank Nifty and Index Options. While you have the opportunity to gain from high returns by placing a cover order, you get to limit your losses by specifying the stop loss trigger price. While taking an intraday position (which is done at market price), you get to specify the trigger price at the time of taking the position itself. This way the downside risk that would normally be present while taking on a leveraged intra-day position is limited by setting the trigger price for the opposite order (square off) at the time of placing the order.
How Does it help you as a Trader?
First, Cover Order help you provide higher leverage while doing intra day trading. Secondly, it help you bring discipline into your trading by asking you to place SL order compulsorily thereby limiting your risk or defining your risk in each trade. While higher leverage afford you more trading opportunity, discipline instilled thru SL affords you to protect your capital by limiting your losses in case trade goes against your plan.
How is a Cover Order different from any other intraday order?
Suppose you wish to take a 'buy' position on Nifty based on intra-day movements of Nifty. In case of a simple order, you are exposed to both the upside and downside movement of Nifty, thereby susceptible to significant risk in compensation for possible high returns. In such a scenario, the client is better off by placing a Cover Order instead. This way you can:
a. Leverage your 'buy' position by a measure of approx four times (depending on the margin).
b. Specify a trigger price (which is for the opposite position, in this case - 'sell'). This trigger price 'sell' order gets executed only if the market price of the stock falls below the trigger price set by the user at the time of placing the Cover Order.
c. Limit losses to the maximum of the difference between the 'Buy' market price and the Stop Loss Trigger price in case of a downside movement of Nifty.
3. Can I take a Cover Order position on any future?
The Cover Order feature has now been extended to only Nifty and Bank Nifty. Thus you can now leverage your intraday positions in nifty and bank nifty by using this feature.
4. What are the types of Cover Orders that I can place?
A client can either place a Buy Cover Order( Alt+F1) or a Sell Cover Order( Alt+F2). A Buy Cover Order implies buying Nifty, expecting the prices to rise during the day, while specifying the trigger price for the sell order in case of a fall in the price. Similarly, a Sell Cover Order implies selling nifty, expecting the Nifty to fall during the day, and at the same time specifying the trigger price for the buy order in case of a rise in the price.
5. Does this mean that both the normal order and the stop loss order get executed at the same time?
While the normal buy/sell order will be executed at the market price, the stop loss order remains passive till the set trigger price condition is reached. Only when this happens will the stop loss order become activated.
6. What are the ways in which I can square off my Cover Order position?
Let us assume that you wish to place a Buy Cover Order for Nifty which is currently trading at 5625 with a stop loss (to sell) at 5600 In case the Nifty falls to 5600, the stop loss order will be triggered automatically and the cover order will be squared off.
All orders that remain open will be auto-squared off by RMS around 3:20 PM at the prevailing market price.
How to Book Profit in Cover Order?
To book profit in cover order you need to go to Order Book by pressing F 3. Order Book window will display you SL order as product type CO. Select your order and click Exit( down right corner of Order Book). Your order will be squared off at Market Rate.
7. How can I place a Cover Order?
Once the orders has been placed you will be able to see it in your order book.(F 3).
Stop Loss once placed in Cover Order can not be cancelled but can only be modified within the range as indicated under trigger Price Range. You will be able to amend the Trigger Price “WITHIN THE RANGE” as indicated at bottom left corner as Trigger Price Range.
Qreous.
FAQ ON COVER ORDER
What is a Cover Order?
Cover Order is a feature that helps you get more leverage while taking an intra-day position in Nifty, Bank Nifty and Index Options. While you have the opportunity to gain from high returns by placing a cover order, you get to limit your losses by specifying the stop loss trigger price. While taking an intraday position (which is done at market price), you get to specify the trigger price at the time of taking the position itself. This way the downside risk that would normally be present while taking on a leveraged intra-day position is limited by setting the trigger price for the opposite order (square off) at the time of placing the order.
How Does it help you as a Trader?
First, Cover Order help you provide higher leverage while doing intra day trading. Secondly, it help you bring discipline into your trading by asking you to place SL order compulsorily thereby limiting your risk or defining your risk in each trade. While higher leverage afford you more trading opportunity, discipline instilled thru SL affords you to protect your capital by limiting your losses in case trade goes against your plan.
How is a Cover Order different from any other intraday order?
Suppose you wish to take a 'buy' position on Nifty based on intra-day movements of Nifty. In case of a simple order, you are exposed to both the upside and downside movement of Nifty, thereby susceptible to significant risk in compensation for possible high returns. In such a scenario, the client is better off by placing a Cover Order instead. This way you can:
a. Leverage your 'buy' position by a measure of approx four times (depending on the margin).
b. Specify a trigger price (which is for the opposite position, in this case - 'sell'). This trigger price 'sell' order gets executed only if the market price of the stock falls below the trigger price set by the user at the time of placing the Cover Order.
c. Limit losses to the maximum of the difference between the 'Buy' market price and the Stop Loss Trigger price in case of a downside movement of Nifty.
3. Can I take a Cover Order position on any future?
The Cover Order feature has now been extended to only Nifty and Bank Nifty. Thus you can now leverage your intraday positions in nifty and bank nifty by using this feature.
4. What are the types of Cover Orders that I can place?
A client can either place a Buy Cover Order( Alt+F1) or a Sell Cover Order( Alt+F2). A Buy Cover Order implies buying Nifty, expecting the prices to rise during the day, while specifying the trigger price for the sell order in case of a fall in the price. Similarly, a Sell Cover Order implies selling nifty, expecting the Nifty to fall during the day, and at the same time specifying the trigger price for the buy order in case of a rise in the price.
5. Does this mean that both the normal order and the stop loss order get executed at the same time?
While the normal buy/sell order will be executed at the market price, the stop loss order remains passive till the set trigger price condition is reached. Only when this happens will the stop loss order become activated.
6. What are the ways in which I can square off my Cover Order position?
Let us assume that you wish to place a Buy Cover Order for Nifty which is currently trading at 5625 with a stop loss (to sell) at 5600 In case the Nifty falls to 5600, the stop loss order will be triggered automatically and the cover order will be squared off.
All orders that remain open will be auto-squared off by RMS around 3:20 PM at the prevailing market price.
How to Book Profit in Cover Order?
To book profit in cover order you need to go to Order Book by pressing F 3. Order Book window will display you SL order as product type CO. Select your order and click Exit( down right corner of Order Book). Your order will be squared off at Market Rate.
7. How can I place a Cover Order?
Once the orders has been placed you will be able to see it in your order book.(F 3).
Stop Loss once placed in Cover Order can not be cancelled but can only be modified within the range as indicated under trigger Price Range. You will be able to amend the Trigger Price “WITHIN THE RANGE” as indicated at bottom left corner as Trigger Price Range.
Qreous.
Why Cover Order is only MARKET ORDER
In cover order a trader puts a buy/sell order and simultaneously places a SL order. Both the orders are pushed at the same time. Imagine what will happen if a trader's buy/sell is not executed and only SL order is pushed. So far we do not have provision where Cover Order with Limit Price is in wait and SL only gets executed once Limit Price is reached. So as of now trade in Cover Order with Market order.
Happy Trading
Team VPS
In cover order a trader puts a buy/sell order and simultaneously places a SL order. Both the orders are pushed at the same time. Imagine what will happen if a trader's buy/sell is not executed and only SL order is pushed. So far we do not have provision where Cover Order with Limit Price is in wait and SL only gets executed once Limit Price is reached. So as of now trade in Cover Order with Market order.
Happy Trading
Team VPS
Hi VPS,
The SMS you are sending for trade summary is a bit difficult to read. For example today I received :
conf : XXXXX for 27-08-2013-375 OPTSTKSBIN26SEP2013 1700CE 24.33 -500 OPTSTKSBIN29AUG2013 1600CE 4 625 OPTSTKSBIN29AUG2013 1700CE 1
No comma, no full stop nothing
If you use excel based format for sending SMS, I guess it would not be so difficult to modify it. Won't it be better if you send the SMS in this way:
OPTSTKSBIN26SEP2013, 1700CE 375 [email protected]; OPTSTKSBIN29AUG2013, 1600CE 500 S@4; OPTSTKSBIN29AUG2013, 1700CE 625 B@1
Or you can think of modifying it in easier way. No hurry, take your time considering it, maybe in weekends
The SMS you are sending for trade summary is a bit difficult to read. For example today I received :
conf : XXXXX for 27-08-2013-375 OPTSTKSBIN26SEP2013 1700CE 24.33 -500 OPTSTKSBIN29AUG2013 1600CE 4 625 OPTSTKSBIN29AUG2013 1700CE 1
No comma, no full stop nothing
If you use excel based format for sending SMS, I guess it would not be so difficult to modify it. Won't it be better if you send the SMS in this way:OPTSTKSBIN26SEP2013, 1700CE 375 [email protected]; OPTSTKSBIN29AUG2013, 1600CE 500 S@4; OPTSTKSBIN29AUG2013, 1700CE 625 B@1
Or you can think of modifying it in easier way. No hurry, take your time considering it, maybe in weekends
Last edited:
Hi VPS,
The SMS you are sending for trade summary is a bit difficult to read. For example today I received :
conf : XXXXX for 27-08-2013-375 OPTSTKSBIN26SEP2013 1700CE 24.33 -500 OPTSTKSBIN29AUG2013 1600CE 4 625 OPTSTKSBIN29AUG2013 1700CE 1
No comma, no full stop nothing If you use excel based format for sending SMS, I guess it would not be so difficult to modify it. Won't it be better if you send the SMS in this way:
OPTSTKSBIN26SEP2013, 1700CE 375 [email protected]; OPTSTKSBIN29AUG2013, 1600CE 500 S@4; OPTSTKSBIN29AUG2013, 1700CE 625 B@1
Or you can think of modifying it in easier way. No hurry, take your time considering it, maybe in weekends
The SMS you are sending for trade summary is a bit difficult to read. For example today I received :
conf : XXXXX for 27-08-2013-375 OPTSTKSBIN26SEP2013 1700CE 24.33 -500 OPTSTKSBIN29AUG2013 1600CE 4 625 OPTSTKSBIN29AUG2013 1700CE 1
No comma, no full stop nothing
If you use excel based format for sending SMS, I guess it would not be so difficult to modify it. Won't it be better if you send the SMS in this way:OPTSTKSBIN26SEP2013, 1700CE 375 [email protected]; OPTSTKSBIN29AUG2013, 1600CE 500 S@4; OPTSTKSBIN29AUG2013, 1700CE 625 B@1
Or you can think of modifying it in easier way. No hurry, take your time considering it, maybe in weekends
Point Taken. Tx for the suggestion.
We will definitely try to change the format. It may take a while. Our IT team will work on it.
best wishes,
Team VPS
Hi VPS,
Why I am getting this error in the morning around 9 AM.
Due to this I am unable to enter trades early.
Any specific reason for this. Is it resolvable or it will come occasionally or it will come daily in the morning.
Thanks,
Qreous...
Why I am getting this error in the morning around 9 AM.
Due to this I am unable to enter trades early.
Any specific reason for this. Is it resolvable or it will come occasionally or it will come daily in the morning.
Thanks,
Qreous...
I got the same error (RMS: Auto square off block) again today .... I reported this error two months before..... You assured this won't happen again....
Thanks,
Qreous...
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