For those of you who use Saxo for USA trades; I’ve been advised by Saxo that Market on Close (MOC) orders can be placed as follows:
- New Trade
- Type: Algo
- Strategy: Market on Close (MOC)
- Enter Buy or Sell details as required
Be aware that you pay a little extra for MoC orders. It appears to be based on Position Size.
For USA trades and Position Sizes of around US$9,000 MoCs cost around $0.10 to $0.70 more.
On the ASX with Position Sizes around $20,000, from a smaller sample than US trades, it may be around $7 - $9 more.
Am awaiting an answer from Saxo to get a better idea of their calculations.
Any luck on closing positions using MoC? Looks like only market or limit orders are available when selecting ‘close position’?
Selecting the “close position” option won’t let you use MOC.
I used “new trade” and was successful in selling my AAPL position at MOC.
Tony & Adrian,
You can click on the ellipses … alongside [Close], but then have to select New Trade, Algo…
Be careful tho, it doesn’t use the correct Qty that you currently hold.
Are Limit on Close orders used for BAPs to ensure the entry is made at or below the Action Price, or is a Market on Close order used providing a BAP signal has occurred on the prior trading day?
If the price near the close is near the action price, you won’t know where it will fall, so in that instance you need a rule if you always want to be below the action price. Eg, buy during day at bap or wait till near to close and buy if it is still below befote the close. Whatever rule you make, is what you should follow. I don’t know what the public portfolio does but it should be in their rules in the plan.
Thanks Phillip. I am interested in what will happen in the public portfolios and have checked the trading plans linked to Beyond Charts. They are dated 25 May 2022. Perhaps there is another place to look for the updated version.
As Gary has reported, all of the simulation runs that I have done also show that there has been an advantage in trading on the close compared to trading on the open for both the Aust and US portfolios. Obviously every structure of basecases will yield different results but mine have shown that the two markets are quite similar with the MOC advantages having been both in the range of 2-4%pa. This is quite a substantial benefit!
I have always traded MOC on the US market and hence I’ll be continuing to do that.
On the ASX, however, I have traded live in the 11am to 12pm period whenever possible. This begged the question of whether it would be worthwhile me swiching from my current broker, Self Wealth, to Saxo to be able to trade MOC. This would mean for me a large increase in brokerage and whilst that increase in brokerage would be easily paid for with an increase in returns of a few percent per annum, I thought I’d better look at it a bit closer since I wouldn’t be moving from a market on open trading starting point. I looked at my last 100 buy transactions and the last 100 sell transactions from PM on the ASX and found that on average my traded prices were a tiny amount better than the closing prices in both cases. The combined benefit of not moving to MOC was 0.12% per trade, which if you expand this by simply (ignoring trade sizes, compounding etc) mulitplying it by say 30 trades per annum equates to 3.45%pa. So, no apparent benefit in changing what I’m doing.
Obviously a couple of hundred transactions is not a big sample especially when the data is quite variable. I started looking at the large amount of older slippage data from TradeMaster. Initially this looked highly promising as the closing price data was already included - I had to labouriously add them line by line for the PM extracted data. That TM data however had a number of obvious problems with prices not being adjusted for stock splits etc. I had no easy way of identifying all these or of adjusting them so I gave up on that data. It would be good to provide a slippage calculation in PM now that the focus is back on the option of MOC trading.
Whilst there is no MOC with Self Wealth, you can still get the closing price by putting your order on between 4.00pm and 4.10pm.
Setting the price at a distance far enough away from the indicative price shown will get you the closing price in just about every case.
Since using MoC orders with Saxo, and with my portfolio full, I’ve noticed that when I place an MoC order to sell a position the following day, and simultaneously place an MoC order for a new position to fill the closed one, Saxo will want to ensure that I have enough ‘actual’ cash in my broker account to cover the buy (before the sell actually occurs and therefore liberating said cash).
As such, it’s hard to stay fully invested as if you are close to 100% invested, Saxo won’t allow you to place the offsetting ‘buy’ position until the MoC ‘sell’ signal has been generated. i.e. you miss a day waiting for the cash to then be able to buy a new position (and of course the signal may not then be ‘valid’ the following day).
Might I ask how people are navigating this?
This is a good point and can happen with orders whether on open or close
I have had on occasions to put my open trade on the next day because funds aren’t available until the sell position is effected
My solution has recently been to buy a CFD instead of stock for the position I am opening but this may not be acceptable to some
Otherwise I guess the answer is to keep additional cash available to cover the new position
Thanks Wakefield… I used to find that after around 10pm for ASX shares, the system would allow me to place trades, even if the value of the trade was (sometimes far) greater than the available cash I had at the time (and it would certainly also do this when the market was open, so I could always get around this if necessary)…
It seems that with MoC orders though, it seems to be a much stricter story, as the platform calculates exactly what the ‘new’ trade value is versus available cash.
That’s an interesting use of CFDs in this situation. What do you do with those CFD positions once opened - do you keep the CFD position until the stock gets a SPA3 exit signal or do you close the CFD position once the funds are available and open an unleveraged position?
Hi Don, I run an unusual system as I hold my positions partly as equities and partly cfds as I find that more efficient than having cash idle, so it’s not a big deal for me to open a position fully as a cfd and if that happens I don’t bother with the equity position and just hold the cfd; it’s only the odd occasion when this is necessary.
Appears Saxo now only offer a limit order, not MOC, on the trick of creating a new sell algo order to exit. Any pearls of wisdom out there on how to overcome this?
Use a broker like Self Wealth Trading. You can get the matchoff price on close and save money if your trades are over about 8k. You also own the stock.
Forget that last query, found MOC under ‘strategy’. Thanks!
Any earlier response raised an interesting question about Saxo vs The other broker ‘you own the shares’ and presumably then get hundreds of bits of paper in the mail. I know SWS use Saxo, as do I - are there any concerns at all about what would happen in the worst case scenario of Saxo going under? Do shareholding owners become the same as other debtors and have to wait in line potentially to lose everything?
I have been caught in the past by this situation - I/you wait in line until it is all sorted, or not.