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TYPES OF ORDERSA market order is an order to buy or sell a specific currency, which is to be filled immediately at the current exchange rate quoted on the screen. Please note that CMS Forex does not currently automatically execute trades, but uses a human dealing desk. It is also important to note that during extremely fast market conditions, it is possible for a trader to get requoted. This means that when prices are moving rapidly, the price quoted on the screen may have already changed by the time the order is processed. Under no circumstances will a market order be filled at a price which the client has not approved. Instead of "slipping" the client into the current market price, CMS Forex will offer the current market price in the form of a re-quote. This re-quoted price is frozen for 8 seconds while the trader decides to accept or decline the price. If no action is taken by the trader, the price is rejected and no position is taken. Entry Order An entry order is an order that is executed at the moment when the market price touches the specified client's price. The executions of these orders are under the supervision of the dealing desk and remain in effect until the client cancels the existing order. Entry orders fall into two broad categories and are executed according to each category: Limit Order and Stop Loss Order Both orders will be executed automatically when the specified price is touched. A stop-loss is an entry order linked to a specific position for the purpose of stopping the position from accruing additional losses. A stop-loss order placed on a Buy position is a stop entry order to Sell that is linked to that position. A stop-loss order remains in effect until the position is liquidated or the client cancels the stop-loss order. The policy of CMS Forex is to honor all stop and limit orders for positions up to 10 lots, under normal market conditions. For positions greater than 10 lots, or during extraordinarily volatile market conditions, in which it may become impossible to execute such orders at their intended price, the next available price will be used to process the contingent order. In those cases, placing a stop or limit order will not necessarily limit your losses to the intended amounts. Also, please note that slippage may occur on stop and limit orders due to weekend price gaps. A limit order is an order that is executed at the moment the market price touches the client's specified price. The executions of these orders are under the supervision of the dealing desk and remain in effect until the client cancels the existing order. Because they will not be executed unless they reach your desired price, limit orders may or may not get executed. For example, if you want to buy GBP/USD, but not until the price drops to 1.6860, you would place a buy limit order at 1.6860. If the price never drops to that level, then the order will remain unexecuted, but it will still be a live order until you cancel it. A stop order is a type of limit order that is placed to lock in a specified gain or loss, closing the position. For example, if you bought GBP/USD at 1.6864 and price has risen to 1.6880, giving you a profit, you may want to lock in that profit in case the price ends up falling. So you would place a stop-loss order to sell at, say 1.6870. This assures that if the price does drop, your position will be closed automatically with a profit. Similarly, you could enter a stop-loss order to sell at 1.6854, thereby limiting your potential loss on the position if the price drops. Stop and limit orders work for both long and short positions. By convention, buy limit and sell stop orders are entered in below the current market price. Sell limit and buy stop orders are entered in above the current market price.Bundled Entry Orders*Bundled entry orders allow a user to set limits and stops for the pending position when creating a new entry order. This ensures that even if your order is executed while you are away from the computer, the order is completely covered by associated limits and stops. If your position reaches your desired profit target, the limit order will close your trade with a profit. If the trade goes against you, the stop order will close out your position at your preset level, limiting your losses. Once a bundled Entry order is placed it does not require any direct supervision, as its execution and the levels at which it will close have already been predefined by the trader. P&L Based Order Entry* Since many traders think in dollars and not in pips, CMS Forex allows its clients to place orders based on monetary values rather than currency prices. Our VT Trader software allows you to set stop and limit orders based on your monetary profit target and maximum acceptable loss without the need to set specific target prices. For example, just tell the system that the maximum loss you are ready to incur on this position is $200 and your profit target is $500, click OK and your limit and stop orders are set. * Entry orders are subject to the same policy as stops and limits, meaning that CMS Forex will honor the price set for the entry order for positions up to 10 lots, under normal market conditions. For larger positions, or during extraordinarily volatile market conditions, it may become impossible to execute the order at the intended price, and the next available price will be used to fill the market order. Trader's Range The Trader's Range feature is a handy way to minimize the costs associated with missing an entry or exit on a position, during an extremely fast moving market. Trader’s Range lets a trader choose a certain amount of pips in either direction from the current market price that he or she is willing to accept. Utilizing Trader's Range takes the place of entering an order, getting requoted and then having to manually accept a new price. Proper use of Trader’s Range eliminates the hassle of a requote when trying to enter orders and helps your orders get filled even in volatile markets. The trading platform supports all standard order types Notice: Be aware that you can also execute all your orders directly on the charts - just right click on a chart to choose the order. Hedging is a very useful tool for those traders that know how to use it properly. Hedging an open position involves placing an exactly opposite trade. Normally, the opposing trades cancel each other out, closing the position. But with our hedging feature, both trades remain active. For example, let's say you bought GBP/USD. You can hedge your position by selling GBP/USD. Both will remain separate active positions, rather than cancelling each other out. Hedging gives the trader upside potential, whichever direction the market heads. It is important that you fully understand how hedging works and how to properly use it before placing any hedge orders. Hedging is an additional feature we have added for the benefit of our clients, and is by no means a required action. Important Notice #1: Opening a new position from the "Dealing Rates" window in the opposite direction from an existing position leads to the liquidation of the original position. Important Notice #2: No additional margin is requested for "hedging" positions. |