Trade Template - Part 4 - Profit Targets, Timed Exits, and Automatic Re-Entry

TAT provides the ability to have your trade closed automatically when your desired profit target is reached, or a certain time of day arrives. Profit target orders are submitted as limit orders as soon as the trade is entered and they are active with IBKR all day. They are submitted as One Cancels Other (OCO) orders along side your stop order(s), so that if either your profit target order or your stop order fills, the other is cancelled.

Profit Target Type

Amount

An Amount profit target let's you specify the amount of profit you want to collect before exiting your trade. If you want to make 0.50 profit on your trade then set the profit target to "Amount" of .50. If it was opened for 1.25, the profit target limit order will be placed for 0.75.

Percentage

For a Percentage based profit target, you provide the percentage of the original premium you want to collect in profit before closing the trade. If you set the profit target to "Percentage" of 80 and your trade was opened for 1.00, then the profit target limit order will be placed for 0.20.

Exit Price

The exit price profit target lets you enter the exact price you want the profit target limit order to be placed for. This is helpful if you always want to exit your trade as soon as it hits 0.10. If you set the profit target to "Exit Price" of .10, then the profit target limit order will be place for .10.

TIP: Once your trade has been filled, you can manually change the profit target amount, if desired. See Managing and Closing Positions here. NEED LINK.

Split Profit Targets

If you wish to exit your trade in parts at different profit levels, you can configure up to 4 different profit targets. TAT will place the first level PT order (and an OCO with your stop order, if applicable) once the trade is opened. When the first profit target order hits, a new profit target order will be placed for the Target 2 level and % to close (and a new stop order for the remaining position Qty). This will continue until the trade closed the final profit target or your stop loss order fills.

This example would close half (50%) of your position when reaching a 20% profit level, then close an additional 25% of your position when reaching a 40% profit level, and clos the final 25% of your position at 60% profit.

Extended Hours Profit Targets (IBKR only)

If you would like your profit target order to be active and able to be filled during extended hours trading, you need to enable that setting on the Trade Template:

Timed Exit

TAT provides two way to exit a trade at a schedule time, prior to expiration. You can only configure one of these options.

Minutes In Trade

With minutes in trade, identify how long you would like the trade to remain open before it is closed automatically by TAT. If you want you exit after 90 minutes, then set this option to 90.

Exit Time

When setting the Exit Time, you can pick a time for your trade to be closed automatically by TAT. This is helpful if you prefer to have all of your trades closed 1 hour prior to the market closed for example. 

Both of these options are implemented by TAT automatically by creating a scheduled task to close your order at the specified time or after the specified number of minutes since the trade was opened. If your order has already been closed (stop, profit target, or manual close) at the time it was scheduled to close, the closing task will be skipped.

Closing Order

Market or Limit (progressive). With a Market order, when the time to close the trade a single Market order will be submitted immediately to exit the trade. With the Limit (progressive) closing order type, TAT will place a limit order to close the trade at mid price. If this doesn't fill, every 5 seconds it will increase the limit price until the order fills. The limit is changed by .05 for the first 3 adjustments and then by a progressively larger amount with each price update until the order fills.

Automatic Trade Re-Entry

TAT allows you to configure your trade to be automatically re-entered in the event of a stop, profit target, or manual close. These options are configured on the trade template. This functionality essentially is adding a new entry to your schedule, using the trade template configured, to execute right away (or after a delay if specified). Your re-entry will more than likely be at different strikes than the original trade, due market movement since the original entry time.

Re-Entries are configured separately for when a trade is closed via a stop, a manual/scheduled close, or a profit target order. 

Re-Entry Template 1 & 2

You can configure which trade template should be used for each re-entry, which can be the same as the original trade, or a different template. You can optionally select a 2nd trade to be triggered as part of the re-entry. 

Delay Minutes

Provide a number of minutes after the previous trade was closed to wait before the re-entry trade should be entered. You can enter 0 if you would like the re-entry trade to be place right away.

Max ReEntries

This allows you to limit the number of times you want a trade to be re-entered. For example, if you want to only allow 1 re-entry, then if the re-entered trade is also stopped out a third trade (2nd reentry) will not be executed.

Don't Re-Enter After

Set the time after which you don't want a re-entry trade to be placed.