Exit trigger on percent attainment of leg's Maximum Profit
under consideration
Norm Klapper
Assume a $10 wide debit spread is opened for $1. Its Maximum Profit would be $900 = (($10 - $1) * 100).
Now further assume that at some time before expiration, the position can be closed for a profit of $895. That's 99% of its potential Maximum Profit.
Does not make much sense to keep the position open, hoping to capture the remaining $5 of potential profit while risking $895!
So... I suggest implementing an Exit instruction that can be set to trigger when a position or leg group achieves NN% of its Maximum Profit.
L
Locked
Exit using a Closing Order has been possible before now, and if you could calculate the Max Profit of an existing strategy (fixed width debit spreads), you could use a CO to exit on the desired Max Profit %.
However, the CO can't be used reliably on a trade that doesn't have fixed widths (delta, premium, etc). Max Profit exit is useful for these trades.
With the addition of the optimizer, we have the ability to assess effectiveness of various spread widths, but no normalized PT that can adapt to those changing widths (useful for debit spreads/RICs/RIFs/etc). This is a new and arguably significant reason to implement this feature.
S
Stefan Schneider
Yes!! And not just for a "leg's" max profit. For a whole trade's max profit please!
Kainen Buch
Yes, this would be hugely helpful for defined risk debit trades like a reverse iron fly!
r
rusty.moorman@optionomega.com
updated the status to
under consideration