1) Common description
1.Unfilled or partially filled Limit Orders may be cancelled or modified
Unfilled or partially filled Limit Orders can be cancelled or modified by the client. Cancellation or modification requests will be rejected if the Limit Orders are completely filled during the process.
2.Period of Validity
Day: Unfilled orders will automatically be cancelled at the end of the trading session.
GTC (Good till Cancel): The order will remain valid until it is completely filled or cancelled(automatically/voluntarily).
Please note that GTC orders will automatically be cancelled under the following conditions:
If the order is not filled after 90 calendar days;
For GTC Order of Futures, the order will automatically be cancelled on the last trading day or 3 trading days prior to the opening day, dependent on the type of Futures contract and the Direction of the Order.
For GTC Order of Stocks, should corporate actions (stock split, reverse stock split, merger and dividend) occur, the order will automatically be cancelled before the market opens on the execution date of corporate action.
3.Statement of order handling using price capping
In accordance with regulatory obligations that the brokers are expected to have certain controls in place to prevent orders with market disruption risks (such as sudden price fluctuations) from being submitted to the market, the executing brokers may set price caps on buy orders and price floors on sell orders.
Please note that while such price limits are set to maximize order execution while minimizing price risk, there exists a possibility that a trade will be delayed or may not take place.
1. Market Order
Market Order ("MO") is an order placed without price setting by clients themselves at prevailing market prices. MO enables the orders to be filled quickly, but can not guarantee the execution price. For illiquid stocks, or for a fast-changing market, MOs can be filled at prices that are much higher or lower. Please assess the risks carefully before placing an order.
Instructions and precautions:
MOs can only be placed during the regular trading hours;
When the MO is placed, the system will earmark a portion of the purchasing power to facilitate the successful execution of the orders as well as maintain a stable risk control value for the account. After the order is filled or cancelled, the earmarked purchasing power will then be automatically released.
Since market orders and orders that rely on market orders (such as stop-loss orders) cannot guarantee the transaction price, market systems that do not support market orders will automatically convert market orders into price orders (there is a 20% price limit for opening orders) to help buffer any drastic price fluctuation.
2. Limit Order
Limit Order ("LO") is an order to be filled at a specified price or better.
The range of transaction price can be locked in with no guarantee.
However, if LO is used, the market opportunity to fill the order may be missed. If the stock price does not reach or drop to the limit price, the order will not be executed.
3. Stop Loss Order
A stop loss order is a market order that is placed automatically by the system to initiate a buy or a sell order based on the direction selected by clients once the stock price has reached or breached a specified price (the “stop price”) set by clients.
Instructions and precautions:
There is no guarantee that the order will be successfully placed and filled. Insufficient purchasing power or positions may result in failure of the order to be triggered.
The order is triggered does not necessarily mean that it will be filled. The stop loss order is the market order which the system automatically places for investors when the trigger price(stop price) is reached. If the order is not matched, it will automatically be cancelled at the end of the market day (except GTC orders).
Q & A with stop loss orders:
-Q: Can a stop loss order be used to take profits? For example, you enter a position at USD 50 and want to place the market order to close off the position when the price of the underlying reaches USD 60. If so, is it appropriate to place a stop loss sell order with a stop loss price of USD 60?
A: No. The above situation will result in the stop loss order to be executed immediately as the current price of the underlying is lower than USD 60.
-Q: What is the appropriate order to use in order to take profits when the underlying reaches USD 60?
A: You can place a limit order to sell at USD 60, in this way the sell order will be executed at USD 60 or better.
-Q: Can I place a stop loss order when I do not have corresponding positions? Are there any impacts?
A: Yes. Usually a stop loss order is a pending order when there are corresponding positions in order to limit losses. Even if there are no corresponding positions, you can still place a stop loss order. In this way, the sole stop loss order can, to a certain degree, breach the tracking of specific trading price.
For example, the current traded price for contract A is USD 3,500, and the investor anticipates that once the contract price falls below the key support region of USD 3,000, its price will continue to fall, therefore he/she would like to initiate a short position. In this case, the investor can place a stop loss sell order with a stop loss price of USD 3,000 without holding any positions of the underlying security. This would also mean that when the price of contract A reaches USD 3,000 or less, the system will place a market sell order for the contract and thus the investor would have opened a short position on contract A.
Key important factor for the investor to take note of is that, as this is a stop loss order,a market order will be triggered once the underlying reaches or breaches the "stop price". Clients will not have control over the price of which the contract would be done.
4. Stop Limit Order
Stop Limit Order requires the clients to enter a specified stop price and a specified limit price. Once the stock price reaches the stop price, a limit order will be automatically initiated.
Stop limit orders will be placed in the form of limit orders, which allow the investors to get their orders done at a more favourable price. However, if the price falls quickly below the limit price, the order may not be filled. Stop limit orders may be limited to certain securities.
The difference between a stop order and a stop limit order:
Both the stop order and the stop limit order are filled when the market price reaches the stop loss price, but the processes how they trigger the orders are different.
The stop order will ensure that the order can be filled as quickly as possible through the form of market orders. However, it does not guarantee the price of which the order will be filled.
Stop limit orders, on the other hand, will initiate limit orders after the stop limit has been triggered. This allows the order triggered to be filled at a price that is equal to or better than the limit price set by the clients. There is no guarantee that the order will be filled.
Instructions and example:
For a buy trade, the limit price must be greater than the stop price and the stop price must be higher than the last traded price.
For a sell trade, the limit price must be lower than the stop loss price and the stop loss price must be lower than the last traded price.
A investor buys 1 lot of X contract at USD 1,000 and wants to control the maximum loss at USD 100. He/she can initiate a stop limit order with a stop price of USD 910 and a limit price of USD 900. Once the price of the X contract drops to USD 910, a sell order for X contract with a limit price of USD 900 will be triggered.
Conditional Order: Clients are required to set the trigger conditions. Once the trigger conditions are met, the entrusted order (either market order or limit price order) will be initiated. Clients can make adjustments and cancellation to the trigger conditions as long as the trigger condition is not met.
Conditional order will only be triggered during regular trading hours (excluding Hong Kong stocks auction period). When a pre-market conditional order is placed, the entrusted order will only be triggered once the conditions are met during regular trading hours.
If the conditional character selected is <=, the trigger price must be lower than the last traded price (triggered higher than the last price);
If the conditional character is selected >=, the trigger price must be higher than the last traded price (triggered lower than the last price)
Prior to the order being triggered, you can cancel the order or modify the trigger condition, order price, and order quantity.
Adjustments and withdrawal of the order that was triggered upon met conditions that was set can still be made as long as the said order is not filled.
Attached order (Additional order) allows the primary order take profit or stop loss. The attached order can be in the form of a take-profit order (limit order) or the form of a stop loss order (stop limit order/stop order)
Instructions and precautions:
Only one sub-order can be attached. When the main order is cancelled, the associated sub-orders will also be cancelled. Sub-orders can be cancelled individually.
When the main order is partially executed, the sub-order will also be initiated. The quantity for the initiated sub-order will not exceed the quantity done for the main order.
When the main order is a market order - As market order is usually filled quickly, the sub-order will be triggered upon the fulfilment of the main order.
Sub orders can only be initiated during regular trading hours.
The validity period of the sub-order is independent of that of the main order. You can choose either "Valid during regular trading hours" or "Valid until order cancellation".
XYZ is currently traded at USD50. Client intends to buy 100 shares of XYZ at USD49 and then take profit by selling the 100 shares of XYZ at USD55.
During regular trading hours, client can submit an Attached Order. The Main Order will include a limit order to buy 100 shares of XYZ at the Limit price of USD49 and thereafter Client can include the Take profit Order to sell the 100 shares of XYZ at USD55 under the Attached Order segment.
In the event where both orders are filled, client will not have any outstanding position in XYZ but rather, left with a profit of USD600 (excluding commissions and other charges) as the Take Profit Order would have then closed off the initial buy order.
7. OCA (One-Cancels-All) order
The OCA order: The client can create an OCA order group. When an order within the OCA order is filled, all other orders within the group will be cancelled.The OCA orders give clients the flexibility to set any order in the form of an order group. However, the order can only be cancelled if it's not filled; before one specific order is cancelled, the risk exists that different orders in OCA order group may be filled.
Introduction and precautions:
Available types of orders can be set in OCA order are limit order, stop loss order, stop-loss limit order;
The amount of occupied funds will be calculated according to the order with the maximum occupied funds in the OCA orders.
When any one order in the OCA order group is cancelled, all other orders within the OCA order will be cancelled, for example, when the day order expires at the end of the regular trading day;
Within the OCA orders, the underlying security of different orders should be the same; within the OCA orders, the quantity of each order can differ.
8.Trailing stop order
A trailing stop order allows users to set the tracking amount or tracking percentage, and automatically adjust the stop loss price according to market price fluctuations. When the market price reaches the stop price (trigger price) , a buy or sell market order to close the position will be triggered.
Trailing stop loss will automatically be adjusted when the market moves in a direction that is favourable to investor, limiting the maximum possible loss without placing a ceiling on the possible gains.
However, trailing stop orders cannot guarantee a specific execution price and that the execution price may be far from the stop loss price.
The tracking amount or tracking ratio needs to be greater than 0.
If you submit a buy trailing stop order at USD 100 with a 20% trailing percentage, the initial stop loss price of the order will be set at USD 120. When the market price falls to 80 USD, the stop loss price will also be automatically revised downwards to 96 USD. The market price therafter: if the market price continues to fall from 80 USD to 70 USD, the stop loss price will be revised to 84 USD. When the stock price rises to or exceeds the stop loss price, a market buy order will be triggered.
The last traded price of the counter is USD 100. A sell trailing stop loss order with a trailing amount of USD10 would mean that the initial stop loss trigger price of the order will be set at USD 90. When the market price rises to 110 USD, the stop loss trigger price will also automatically be revised upwards to 100 USD; When the stock price falls to or below the stop loss trigger price, a market sell order will be triggered.