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How Long?

Hi! Can you give me some principles to determine how long I should set an expiry for in a pending order? Should it be a multiple of the time frame (e.g., 12 X 15 minutes)? If so, what multiple would you recommend? Some other method?

You sent an interesting question, but no detail as to what you are trading. In any event, I know of no formula regarding how long to wait for an order to be filled. In general, I will wait until I'm tired of waiting, a better opportunity comes along, or something indicates to me that my order isn't likely to be filled.

Example: I want to sell uncovered puts on shares of a company's stock. As long as the shares remain in consolidation, there's a good chance for a fill. That could be many days. But if prices begin to trend upward, and the available premium begins to shrink, or premiums shrink because of loss of time value, I will abandon the trade to look for something else.

Example: I'm day trading the mini Nasdaq (NQ) on a ten-minute chart. If prices begin to trend away from my entry point, I won't wait very long. If I'm in a day trade, and prices begin to move against me, I am quick to get out of the trade while I can still get out without a loss of profit (if there is any), or loss of capital.

In essence, how long to wait for a fill is pretty much a judgment call.

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Saturday, 15 May 2021

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