SmartPricing

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FAQs

Why is the SmartPricing sequence outside the range of the Bid-Ask Spread?

The bot sets the max (or min) price for smart pricing at 100% (or an alternative percent chosen by the user) of the bid-ask at the time the automation runs to ensure the math used by the automation is honored/enforced. In the half-second to one second between that moment and the time when the order is sent and SmartPricing captures the displayed bid-ask spread, the prices can change and this creates a discrepancy.

The bid-ask spread displayed is the one at the time the automation runs. This is for the user's protection.

For example, a bot may check for a minimum return of 50% on a position, set a max price that reflects that and in that half-second to one second something can happen that moves the price drastically to a completely different bid-ask. If the new bid-ask spread were allowed and it moved significantly, a user might get only 35% or even worse, take a loss. Setting the max/min price in advance ensures that will never happen.

What happens if SmartPricing does not fill an order?

If SmartPricing does not fill an order and is timed out, the order will be canceled. The canceled order is displayed as "Canceled" in the Closed Positions section. The bot will place the order again at the next interval if the automation's conditions are met.

What if I place a limit order and the order does not fill?

A limit order will time-out after two minutes and will appear as a canceled position in the Closed Positions section. The bot will place the order again at the next interval if the automation's conditions are met.

Is the full range of 0%-100% available for the Bid-Ask Spread?

No, you can use a range of 50-150% of the bid-ask spread when using SmartPricing.

What is the best range to traverse of the Bid-Ask spread?

This answer will vary for different traders and is a function of preference. The SmartPricing settings allow you to choose between different speeds and prices.

For example, if you are entering a trade that is 40-60 days out, you may not mind waiting for a fill, so you might use the patient setting.

If you are looking to enter a shorter term position, it may be more important to achieve a quick fill, so the speedy setting may be better.

It is important to think about your bot and how your trade strategy would fit into these scenarios.

How does a bot use SmartPricing to assess risk, allocation, and return?

When a bot assesses the bid-ask spread using SmartPricing, it automatically calculates risk and return values based on the worst possible price.

For example, if you allocate $500 of risk to a long call position, and the SmartPricing range is $4.90-$5.10, the bot will not open a position because it assumes a worst-case scenario of a $510 debit.

When and why would I use the "Final Price" option for "Percent of Bid-Ask Spread?"

This features optimizes pricing by allowing SmartPricing to "walk" the bid-ask spread in an effort to fill a trade at a better price than the market price.

When and why would I use the "Final Price" option of "Position trade price(x,+,-,/)?"

This feature gives you the ability to submit a closing order that is a mathematical function of the entry trade price.

For example, a long option profits when the exit price is higher than the entry price. So, the “+” function tells the bot to close the position above the entry price by a defined value. +$1.00 would exit the position $1 higher than the opening price.

When and why would I use the "Final Price" option of a "Fixed Dollar Amount?"

This function is similar to a limit order. Your trade will fill at the price specified by the "Fixed Dollar Amount". Limit orders may be more difficult to fill, but they may result in better pricing.

Why would I use "Percent of Bid/Ask Spread" instead of "Fixed Dollar Amount?"

You could use "Percent of Bid/Ask Spread" when you want to "walk" the bid-ask spread to try and get a better fill. "Percent of Bid/Ask Spread" attempts to optimize available prices and fill your order at the best price.

The "Fixed Dollar Amount" final price effectively places a limit order. It will fill if and only if the price is available.

Why is "Position Trade Price (x, +, -, /)" not available for opening orders?

The "Position Trade Price" references a position’s entry price. An opening order does not have a price to reference, so the function is not available.

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Kirk Du Plessis

Founder

Last updated:

March 16, 2023

Mar 21, 2023

Originally published:

Jul 13, 2021

Mar 24, 2023

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Up next...

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Related articles

Platform Tour

Creating a Bot

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Using Loops

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Using Tags

Using Inputs

Automation Scheduling

Bot Logs

Manual Trading

Trade Ideas

Using the Bot Wizard

Templates and Cloning

Backtesting

Managing Positions

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