Trading

What is bracket order? How does this feature work?
  • A bracket order can be placed such that the parent order (Leg1) is placed with two cover orders of the same quantity; that is, the book profit trigger order (Leg2 | exit at target) and the loss exit order (Leg3).
  • The parent order (Leg1) is immediately sent to the Exchange and the book profit trigger order (Leg2) and the loss exit order (Leg3) are at application level and not sent to the Exchange.
  • Once the parent order (Leg1) is executed, the book profit trigger order (Leg2) and the loss exit order (Leg3) are considered for viable conditions; that is, the condition to check Leg2 and Leg3 touching the market rates.
  • Once viable conditions are in favour, either of the cover orders (Leg2 or Leg3) is generated and placed to the Exchange for squaring-off the position. For example, a normal Buy order placed at Rs 10 can be bracketed with a higher Sell order at Rs 15 (profit-booking order) and a lower stop-loss order at Rs 9 – 8 limit.
Was this article helpful?