Safeguards For Auto Trader Explained

The objective of this video is to show you how to create market safeguards for the Auto Trader. These safeguards will help ensure that the Auto Trader stays within specified limits and protects against potential market crashes.

Key Steps:

1. Buying Power Allocation:
   • Determine the amount of your account's money that the autotrader can use.
   • If you have a specific amount you want to allocate for trading (e.g., $10,000), input that amount.
   • This ensures that the autotrader will not exceed the specified buying power limit.
   • Note: The autotrader will not place a trade if it exceeds the buying power limit, even by a penny.
   • Cautionary Note: This step is required for setting up the market safeguards.
2. Max Positions Open at a Time:
   • Decide on the maximum number of open positions you want the autotrader to have.
   • Consider the buying power limit and the trading strategy you are using.
   • If the buying power limit allows for more positions than desired, input the desired number of positions.
   • This step is optional, and you can leave it blank if you don't want to limit the number of positions.
3. Market Crash Safeguard:
   • Understand that a market crash is triggered when the market exceeds three standard deviations of a normal move and then starts to come back down.
   • Enable the market crash safeguard if you want the autotrader to exit positions when a market crash is likely.
   • This safeguard helps protect against significant losses during market crashes.
   • You can choose to enable or disable the market crash safeguard based on your preference.
   • Note: The market crash safeguard is not required, and you can choose not to enable it.
4. Understanding Plan Restrictions:
   • Be aware that the buying power allocation is restricted based on your pricing plan.
   • Starter Plan: $25,000 buying power limit per autotrader.
   • Pro Plan: $50,000 buying power limit per autotrader (most common plan).
   • Unlimited Plan: $250,000 buying power limit per autotrader.
   • If you reach your buying power limit, consider upgrading to the next plan to increase the limit.

Cautionary Notes:

• Ensure that the buying power allocation is set correctly to avoid exceeding the account's available funds.
• Be cautious when setting the max positions open at a time, as it should align with the buying power limit and trading strategy.
• Consider the potential risks and benefits before enabling or disabling the market crash safeguard.

Tips for Efficiency:

• If you are unsure about any of the settings, click on the question mark icon for explanations.
• Review your pricing plan to understand the buying power limits and make appropriate decisions.
• Use the chat box for any questions or clarifications.

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.