What is Limit if Touched order?

Buy Limit if Touched

A buy limit if touched order is an instruction that submits a limit order to buy at a fixed price lower than the trigger price when the market price reaches the trigger price. The specified trigger price must be lower than the current market price.

Sell Limit if Touched

A sell limit if touched order is an instruction that submits a limit order to sell at a fixed price higher than the trigger price when the market price reaches the trigger price. The specified trigger price must be higher than the current market price.

1. Example:

• Buying Direction

Let's say you have a short position with a cost price of $10. If you submit a sell LMT if Touched order with a trigger price of $5 and a limit price of $6 when the market trading price is $20, the order will be automatically submitted to the market when the stock price reaches $5 or below. The order has the potential to be executed at $6 or at a better price.

• Selling Direction

If you submit a sell LMT if Touched order with a trigger price of $30 and a limit price of $29 when the market trading price is $20, the order will be automatically submitted to the market when the stock price reaches $30 or above. The order has the potential to be executed at $29 or at a better price.

2. Order Time:

Orders can be placed at any time on the client’s side.

3. Trigger Time:

The trading session can be set as " Include Extended Hours" or " Only Regular Hours”. The order trigger conditions will be applied based on the different session settings. Once the conditions are triggered, the system will automatically submit the default order to the market.

4. Order Duration:

Clients can choose the order duration to be day or Good-Til-Cancelled (GTC). If the order is not filled within the order duration, the system will automatically cancel the order.

If an order fails before the order was transmitted due to risk control measures, corporate actions, or other reasons, the order status will be updated as cancelled, and the system will not continue to submit the order.

5. Explanation and Notes

1. Placing a conditional order does not immediately freeze buying power or positions. Validation will only occur when the order meets the trigger conditions. Please note that triggering a conditional order does not guarantee successful submission to the upstream broker or exchange and it is possible to fail due to insufficient buying power or positions in the account.

2. After an order is triggered, there is no guarantee that it will be executed. LMT if Touched order simply means that the system automatically submits a limit order for the investor once the trigger price is reached. The processing logic for submitted orders after they are triggered is the same as placing a regular order, and if there is no match, the order will be automatically cancelled after the specified period.

3. After an order is triggered, whether the corresponding order is executed or not, the order trigger condition will not be activated again. If needed, please place a new order.

4. After an order is triggered, the system will submit a limit order. For the convenience of the client’s order management, the order type will remain the same, and the order type will still be displayed as a “Limit if Touched” order.

5. After the order is triggered, it will be determined whether the order can be submitted to the upstream broker or exchange based on the account's maximum buying power, which may involve financing. Placing a trigger order does not freeze the buying power. However, if the order amount in the cash account exceeds twice the net asset value of the account, the order cannot be placed. Similarly, if the order amount in the margin account exceeds five times the net asset value of the account, the order cannot be placed.

6. Orders do not support executing multiple directions simultaneously. If the order quantity is more than the position at the time of triggering, the order will not be executed. In other words, the order cannot simultaneously buy and buy-to-cover or sell and short selling.

7. LMT if Touched order will only be triggered during the allowed trading hours.

8. The orders are limited to US securities.

9. If the number of pending trigger orders is equal to or greater than 50 orders, no further advanced orders can be placed.