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Covering Shorts with Marketable Limit Order

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I've read both of Andrew's How to Make a Living Daytrading books.
He mentions that he sets his buy orders at (bid price + $.05)

I can see how this is extremely advantageous for getting a good entry.

But is this strategy also recommended for covering shorts?
Just wondering because I'm picturing that covering shorts even at market price would be better than not covering at all.

Can anyone provide any insights here?

 

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For me - I use limit orders to open positions (buy or short) and market orders to close them (sell or cover). Really, if you're selling a position, you want to close your position at the best price available without delay. The nightmare scenario is to be short a stock that suddenly belts up  and you're stuck trying to use limit orders that won't fill. 

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I use a marketable limit to close long positions at ask+0.05 and have, on 90% of occasions, been able to get a fill at my preferred target. In the 10% of cases I don't, I simply move my limit sell down a bit until it fills and get out at a few cents under my target; but profit is still profit and in these cases, the price continues to push downwards. For short positions i always do a market buy to close. While I can expect 90% of marketable limit buy orders to fill; the 10% that don't could end up in a loss greater than what as planned, particularly if my stop loss is near a critical battleground area such as a MA, VWAP, or previous level. As a risk management strategy, I'm willing to risk a little bit of profit 10% of the time in order to get more optimal fills 90% of the time for long positions; however, for short positions I rather close at less optimal market buys 90% of the time to avoid getting trapped during the start of a bull run 10% of the time- which at least on the type of stocks I primarily trade (small caps with low float), can lead to a trade where my unrealized gains dwindle quickly, and I'm scrambling to place a market buy to close anyways.

Edited by kishp_
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On 2/27/2021 at 2:47 AM, kishp_ said:

I use a marketable limit to close long positions at ask+0.05

Do you use MARKETABLE LIMITS in pre-market ? 

If not, do u know if its possible ? 

Whts ur expert opinion ?

I am also trying to understand the best use of STOP LIMITS in pre-market and general market.

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