** ICICIDIRECT MARGINPLUS trading question **

#1
Hi

First of all,I'm glad I found this one -- whoah, you guyzs are awesome and I would so much appreciate any help.

Here is my problem
I am a newbie to trading but fairly computer friendly .
'm using ICICIDIRECT as my demat.
I've tried doing margin trading, cash and spot trading.. they were easy ones.

HOwever, when trying MARGINPLUS and things got bizarre !!!
well, as a matter of fact, when we were just doing MARGINPLUS trading,

There were 2 options - fresh order and cover oder.
So for instance, we are doing a "buy" in fresh order and the cover order automatically changes to "sell" ... I get that part
NOw in cover order, we had to input sthin in SLTP(Stop loss trigger price) and in LIMIT price

The issue being, though I buy at a price say Rs.10 and I would so obviously want to sell it at a higher price and entered say Rs.20 in SLTP or LIMIT prices in cover order - IT JUST WONT TAKE IT...
It will only accept a price less than Rs.10 ???? Why is that? Does it mean I sell less than 10 bucks and lose money... Why would someone do it?

I hope I made myself clear.. IN short, things get crazie and I had been losing money... honestly, the demo or cust serrvice in ICICI sucks..

Please help.. Would you make my day?

Thanks again..

I greatly appreciate your time.

Regards
INCOGNITO

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#2
INCOGNITO,

Systems are much smarter than us. this is how it works....I dont know about other trading systems or exchanges.
But, with ICICI it is how it works, I learnt a bit of this after a long long experience.


Say in MarginPlus you Buy (always at market price, the catch, you'll be killed with slippages). Since the stakes are high you can play 25 times more than the money u have. ICICI wants to place a cover order immediately

Stop Loss is like something if it goes against your wish can be triggered to Square Off your pending poistion, so that you'll end up with minimum loss.

say Buy 100 shares of Infosys at market price ( say 2900 at that point).

cover order is, if in case infosys prices goes below 2800, you want to square off by placing a limit order at 2799.50 ( it should be less than limit price).

Its makes you ready for uncertainities.

Its rather bizzare to have such a system, but thats how it works. It has its own advantages and disadvantages.

I hope it clears your doubts...

You a huge open position open and ICICI website goes down what u r going to do if the market goes in reverse direction? you'll end up with huge losses and S.L can prevent that.

Satya
 

vince

Active Member
#3
The funda of a stop loss order is as follows:
Taking the above example if you are long infosys @ 2900, you can place a sell stop order only at a price less than last traded price which could be 2800. If the price goes up to 3000 you can modify the stop order to 2900 and so on. If your stop gets hit your order should get executed at somewhere close to market price.

Reverse the above for a short position.

If you are trading thru icici a stop order is a boon.
Murphys law is a reality whe you are trading thru them. Everything that can go wrong will.
 
#4
Hey incognito,

I also have used icici margin plus and lost a lot. The icici platform is not designed for daytrading and the margin plus is a real leveller because there are not enough options: like selling half the shares as soon as we see profits and hold on to the rest (and see how it spans out). The speed of execution is also a grave concern because whenever ther is a spurt in the price the icici platform tends to be unresponsive. But, using icici for holding long positions makes good sense and if at all someone needs to daytrade margin order is ok (not the best). If you are looking at day trading you should look to other platforms like indiabulls, kotak, sharekhan...etc.
 
#6
a stoploss is basically placed to avoid huge losses in case the price of the scrip goes against your position or to protect your gains. the stop loss is triggered most of times resulting in a stream of losses and we tend curse the stoploss and wonder whether stop loss is necessary if you are taking a position. our accumulated losses mostly due to triggering of stoploss. to place a stoploss at the right price is an art by itself and very difficult to master.
 

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