Explore Your Options by Tom Gentile
NOT GETTING FILLED
I live in Europe and I often place my
orders outside of US market hours. I
almost always use limit orders between
the bid and ask. For example, I tried to
buy a call option the other day, but I did
not get filled because the stock opened
almost $2 higher than the previous day.
I know this is all part of the game, but
itís frustrating to watch a potential
trade go up by about 40% in two days
and missing out because I didnít get
filled. Is there anything I can do?
Some of your orders are not getting
filled for two very important reasons.
The first is due to the price or quote
information used to set the limit orders.
You are taking information from the
prior trading session, but a lot can
change overnight or over the weekend.
If you want to buy a call option on a
volatile tech stock, shares might open
higher if the US stock market is strong
that day. If the stock is higher than the
previous day, the call options will have
increased in value as well. If so, the
limit order, which is based on yesterdayís
quote, is not going to get executed because
the market price is now higher.