Česky | English
Infomail: fio@fio.cz

Trailing Limit (KOBOS)

This intelligent order is defined for lowering investment risk and for locking in a profit using a flexible Stoploss order that reacts to changes in the market price of the title. The Stop Price is automatically shifted upwards (for a Trailing Limit sell order) using a pre-defined step from the best offer on the market. This shift is completely automatic and continues until a change in the price of the highest offer occurs or the best offer slightly declines with possible deviations until it reaches the Stop Price, which is redefined with the pre-defined step upon order placement.

A Trailing Limit sell order attempts to sell just below the local or daily maximum during a change in the trend; a Trailing Limit buy order attempts to purchase just above the local or daily minimum during a change in the trend. The floating Limit Price in the order also provides protection against soft trends or in the event the order is executed (e.g. the currently calculated Stop Price is achieved) due to a buy or sell order on the market where the Limit Price calculated from the entered deviation from the final updated Stop Price occurs.

A floating Limit Price provides protection against sales at prices that are too low, or purchases at prices that are too high in a soft market.

Trailing order

  • SPAD is the market used for defining Stop Prices.
  • The Stop Price is the price that defines the limit from which a client can start to sell or buy. When selling (a Trailing Limit sell order), the best buy quote (bid) in SPAD is considered in all cases. When buying (a Trailing Limit buy order), the best sell quote (offer) in SPAD is considered.
  • A Trailing Limit order must always have a defined purchased / sold quantity, the Trailing Stop parameter and a deviation from the Stop Price, the Trailing Limit parameter and the deviation from the Limit Price.
  • We recommend selecting the deviation from the Stop Price as twice the maximum spread in SPAD for the given security. If the Stop Price deviation is less than twice the maximum spread in SPAD for the given security, the validation system will warn of an increased risk that the order will be executed during smaller market fluctuations.
  • The Stop Price cannot be less than the maximum spread in SPAD for the given security. The maximum allowed ranges in the quote for the individual titles are defined by the exchange commission and are published at the PSE website .
  • When placing a Trailing Stop intelligent order , it is possible to also use other parameters in KOBOS, e.g. Minimum Quantity, Displayed Quantity, Trade Immediately or Cancel.

How does the order work?

Placing a PSE-KOBOS Trailing Limit order.

  1. The client enters a buy or sell intelligent order - Trailing Limit form for a KOBOS order, which must contain the ISIN, Total Volume (shares), deviation for Limit Price calculation (entered into the "Price" field), deviation for Stop Price calculation (entered into the "Stop Price" field) and the Order Validity. Other parameters, Minimum Quantity and Displayed Quantity can also be entered.
  2. The validation checker ensures the order is allowed and, if so, the order is activated. A trailing stop order is rejected if the deviation from the Stop Price is lower than the maximum spread in SPAD for the given security.
  3. Once the order is validated, the software defines the "opening" Stop Price using the deviation between the defined Stop Price and the current best bid (for a sell order) or best offer (for a buy order). It then searches for changes in the best bid (for a sell order) or the best offer (for a buy order) for any changes in the current Stop Price. For a sell order this change is made if the price for the best bid decreased by the deviation from the Stop Price is higher than the current Stop Price; for a buy order this change occurs when the price for the best offer increased by the deviation from the Stop Price is lower than the current Stop Price.
  4. The software also checks where the current Stop Price is higher than or equal to the best bid in SPAD (for a sell order) or less than or equal to the best offer in SPAD (for a buy order). If this occurs, the Trailing Limit is activated. A sell order or buy order is immediately sent to the market depending on the selected parameter. The order is active until the entire purchase or sale is completed, the order expires or is cancelled by the client.
  5. Two conditions must be met to activate a Stoploss sell order:
    (a) The best bid on the SPAD market is lower than or equal to the current Stop Price.
    (b) There are at least two buy quotes on the SPAD market.
  6. These conditions must be met to activate a Stoploss buy order:
    (a) The best offer on the SPAD market is higher than or equal to the current Stop Price.
    (b) At least 2 sell quotes on the SPAD market.

Note 1) When a Trailing Limit order is placed before the opening of the SPAD market, the current Stop Price is set immediately after SPAD opens. If the Trailing Limit order is activated, the order is sent to Fixing / KOBOS using the entered parameters.

Note 2) The Trailing Limit provides an investor with additional protection against non-standard market situations (quickly changing prices, etc.).

Note 3) Once a Trailing Limit intelligent order is activated, a sell order with a Limit Price is generated on the market. If the order cannot be satisfied at once, it remains on the market until complete satisfaction or expiration of Order Validity.
If growth occurs (for a Trailing Limit sell order) or a decline occurs (for a Trailing Limit buy order), the "intelligent order" is not triggered again, e.g. the changes in the market after the order is triggered do not cause any changes in the Stop Price and Limit Price.

Example Trailing Limit sell order

An investor is concerned that the price of CZK 700 for shares of Erste Bank could cause a further sell off and decline in price and places a Trailing Limit sell order for 1,500 shares with a deviation from the Stop Price of CZK 15. The investor is concerned that remaining bids will be quickly purchased at this price level and his 1,500 shares are market price will have to be sold at much lower than this level and for this reason he enters a Limit Price deviation of CZK 5.

  • Best bid (SPAD): CZK 709.30
  • Entered Stop Price deviation: CZK 15
  • Entered Limit Price deviation: CZK 5
  • Number of sold securities: 1,500 shares

SPAD before placing the order:

KOBOS Trailing Limit sell order was placed with a Stop Price of CZK 694.30 (best buy quotes in SPAD: CZK 709.30 - 15) and a Limit Price of CZK 689.30 (based on Stop Price CZK 694.30 - 5).

If the market begins to drop following order placement (e.g. the bids in SPAD do not rise above CZK 709.30), the Trailing Limit order is activated at the moment the best purchase quote in SPAD drops to or below a value of CZK 694.30 (and at least two quotes have been active on the market). This results in a sell order for 1,500 shares to KOBOS with a Limit Price of CZK 689.30.

Market makerPrice (CZK)Cumulative number of shares 
ING712.5035,000Offer
WOOD712.0030,000
FIO711.4025,000
HVB711.3020,000
CS, PF, KB711.0015,000
 710.00 Last trade
PF709.305,000Bid
KB709.0010,000
HVB708.6015,000
FIO, ING708.3025,000
CS, WOOD708.0035,000

Before order is placed in KOBOS:

Price (CZK)Cumulative number of shares 
713.005,650Bid
712.304,850
712.001,850
711.501,150
711.40400
711.30 Last trade
710.00200Bid
709.801,200
709.503,400
709.003,800
709.804,150

SPAD following a price increase:

Based on SPAD development and pursuant to the conditions of the Trailing Limit sell order, the Stop Price increases to CZK 702.50 (pursuant to the best SPAD quotes: 717.50 - 15) and Limit Price moves to CZK 697.50 (based on Stop Price settings: 702.50 - 5).

If the value of the best buy quote declines (until the conditions for Trailing Limit activation are met), then the order is activated when the best buy quote in SPAD drops to CZK 702.50 or lower and there are at least 2 quotes active on the market. This results in a sell order being sent to KOBOS for 1,500 shares with a Limit Price of CZK 697.50.

Market makerPrice (CZK)Cumulative number of shares 
HVB721.0030,000Offer
PF720.5025,000
ING719.9020,000
WOOD719.8015,000
FIO, KB719.4010,000
 719.00 Last trade
CS717.505,000Bid
ING717.2010,000
FIO716.8015,000
WOOD, PF716.5025,000
KB, HVB716.2035,000

KOBOS after increase:

Price (CZK)Cumulative number of shares 
722.006,430Offer
721.005,730
720.404,130
720.30330
720.00130
718.20 Last trade
717.00300Bid
716.803,200
716.503,550
716.004,250
715.805,600

SPAD after price decrease:

Change in structure of bids and offers in SPAD (market first increases - best bid in SPAD is CZK 728, then drops to the following values):

Market makerPrice (CZK)Cumulative number of shares 
KB715.0030,000Offer
ING714.8025,000
FIO, PF714.7020,000
HVB714.6010,000
CS714.505,000
 713.70 Last trade
PF713.005,000Bid
KB, ING712.9015,000
HVB712.6020,000
FIO, CS712.5030,000
WOOD712.0035,000

KOBOS following price drop:

Based on previous developments, the Stop Price is CZK 713 (based on best quote in SPAD 728 - 15) and the limit value is CZK 708 (best on Stop Price: 713 - 5):

Price (CZK)Cumulative number of shares 
717.504,730Offer
717.003,930
716.303,600
715.502,100
715.00400
713.00 Last trade
712.90400Bid
712.601,000
712.502,500
711.703,200
711.504,200

Result:

Sell order is paired with the best bid in KOBOS and the trade is completed via three separate trades:

  • 400 sold at CZK 712.90
  • 600 sold at CZK 711.60
  • 500 sold at CZK 712.50
e-Broker

Login | Create demo

Internetbanking

Login | Create demo

Search in contacts

Map CR
Facebook Twitter YouTube
Twitter LinkedIn

Exchange Rates

BuySell
EUR24,9024726,17953
USD22,1744223,31158
GBP27,7650729,18893
CHF22,5985523,75746
PLN5,857806,15821

Other currencies


These sites use cookies. By using these sites you consent to their use. More information X