Trade Management Details For Auto Trader Explained

The objective of this video is to provide clear instructions on how to set the manage details for your Auto Trader. By following these steps, you will be able to effectively set the take profit percentage, stop loss percentage, early management, and hedge options in order to maximize profits and minimize losses.

Key Steps:

1. Take Profit Percentage:
   • Determine the maximum profit on a trade based on the credit received.
   • Calculate the take profit percentage by multiplying the maximum profit by the desired percentage (e.g. 75%).

   • Set the Autotrader to close the trade once it reaches the calculated profit amount.

     Stop Loss Percentage:

   • Calculate the stop loss amount by multiplying the credit received by the desired stop loss percentage (e.g. 300%).

   • Set the Autotrader to close the trade once it reaches the calculated stop loss amount.

     Early Management:

   • Determine the number of days before expiration that you want to close the trade.

   • Set the Autotrader to automatically close the trade when the remaining duration is equal to or less than the specified number of days.

     Hedge Options:

   • If trading a 1-1-2 strategy, choose between two options: a. Close the entire trade once it hits the take profit percentage. b. Convert the trade into a pds hedge or a ratio hedge when the stop loss is hit.
   • For other strategies, this setting will not be visible.

Cautionary Notes:

• It is important to understand the Auto Trader settings and their implications before making any changes.
• Be cautious when setting the take profit and stop loss percentages to ensure they align with your risk tolerance and trading strategy.
• Double-check all calculations to avoid any errors in setting the trade management rules.

Tips for Efficiency:

• Use the question mark icon next to each setting for a detailed explanation and example.
• If trading non-defined risk trades (e.g. selling puts, selling calls, strangles, 1-1-2), it is recommended to set a stop loss.
• For iron condor trades, stop loss is not necessary as it is predefined.
• If you have any questions, refer to the question markers or use the chat box for assistance.

TERMS OF SERVICE: Please be aware that continued use of the Options Auto Trader is subject to our Terms Of Service. If you have any questions or wish to review these terms, feel free to visit the website.