This tutorial covers the TWS “alarm” function. There is also a more sophisticated “alert” function that allows TWS to automatically make trades based on stock price action. Also, IB has the order types “market if touched (MIT)” and “limit if touched (LIT)” that will submit an order if a stock hits a certain price. I will address these features in future videos.
Disclosure: Long 249 shares ZRBA. I have a disclosure policy.
0 thoughts on “How to set stock price alerts in Interactive Brokers Traders Workstation”
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Why not buy 249 shares of ZRBA in one account and short 250 shares of ZRBA in a separate account? That would eliminate the risk that the company doesn’t actually go through with the reverse split.
Dan — that would also eliminate all upside.
My thought was that in the event the reverse split occurs, the 249 shares you buy will get you cashed out at 5.20, but the 250 shares you short will remain at the market price because they would be substituted for 1 new share. Could you please explain why this would not be the case?
I guess you are assuming the stock price will be bid up to 5.20 before the reverse split occurs
Dan — your idea is not so bad as I thought but not so good as you thought. What it does essentially is change your risk: rather than betting on the deal going through, you are betting on the stock dropping after the deal goes through. Probably not a bad risk, but a very different one from the one I wish to take.
Look at it this way: as the reverse split becomes closer and closer the risk of it not happening decreases. People then have an incentive to buy 249 shares (if they don’t have any) at higher and higher prices. They will thus tend to drive the price up to the price at which shares are getting cashed out (otherwise there would be a risk-free profit by buying the 249 shares just prior to the reverse split). However, this process could be hindered if large shareholders sell.
One way or the other, it is very likely that the stock price will be very close to the cash out price when the reverse split occurs. So at that point your long shares would be cashed out and you would be short a stock that is priced about where your long shares were cashed out. Thus, to obtain any profit you would have to remain short and hope the stock then goes down as the buying pressure would decrease.
Ha, leave it to IB to use the most annoying sound in the world for their alerts!! 🙂
Idea for future tutorial, how to check real time short availability, I know you’ve told me before but I still use the semi-real time webpage as opposed to TWS to check availability of borrows. Thanks
tbohen — I’ve actually been working on that and a post on how to check short stock availability at every broker.
Good I’ve been waiting for you to publish IB for dumbass’s!! I need it!
Oops – I know your secret trading strategy now. And I was going to pay you a hundred grand…
Phatdogman — you could not have learned it from that video or anything else I’ve written here.