Here is all you need to know about basket orders
“Don’t put all your eggs in one basket”, is one of the most frequently used sayings in the investment world. This saying essentially underlines the importance of diversifying one’s investments across different investment assets and even within a single asset class. While we are all for having a diversified portfolio, we believe having a single basket has its own advantages. Curious? Well, we are talking about ‘basket orders’.
What is a basket order?
A basket order is a feature that allows you to place multiple orders and strategies at the same time. This feature is similar to ‘cart’ functionality where you can add multiple stocks and/or futures and options contracts in your basket and place all orders at once with a single click. This feature is very helpful for both investors and traders alike.
Research different stocks, identify the ones you want to invest in and keep adding them to your baskets
Create different trading or hedging strategies while trading in futures and options
Use strategies like Straddle, Strangle, Bull call spread, Iron condor or any other custom strategies which have more than one leg, in the least amount of time
Given its high convenience and benefits, basket order feature has become a hit with customers and as a 5paisa customer, you can avail this feature on both our platforms i.e. Mobile app and Web platform (TradeStation web).
At 5paisa, you can use our basket order function to add upto 10 orders in a basket and create unlimited number of baskets. What’s more, with our cloning feature, the process of basket creation has been simplified even further. If you wish to clone any of your existing baskets, you can do the same with just a single click. Cloning is possible for any particular order inside a basket or the complete basket itself.
Another important element of the basket order functionality is ‘margins’. While creating different trading strategies, a derivative trader needs to know the total margin required for executing them. With our basket order functionality, you can get this information upfront. It not just sums up the margins of all individual orders but also considers any hedged orders while arriving at the required hedged margin.
With this information, you will know the actual margin that will get blocked on the execution of your basket. For instance, you wish to go long on Nifty i.e. you will buy Nifty future contract. In order to place one lot of Nifty future contract, the margin requirement is around Rs.1 lakh. Now, if you wish to hedge this position with buying a put option, then the margin requirement will reduce significantly to as much as by 60-70%.
Another advantage of basket orders is that you can create basket orders anytime and be prepared for next day’s trading session.
Advantages of using 5paisa Basket Order
How to create basket order in 5paisa app or website?
Follow these steps to create your own basket order:
1) Login to the 5paisa web or mobile app, visit the Orders section
2) Click on Baskets under Orders section
3) Click on ‘Create Basket’, give a desired name to your basket order and click on Save
4) Now search your desired stock, future or option contracts
5) Select all the required details/options such as buy/sell, price, quantity, order type and then press the Add button. You will see that your order is added to your basket order.
6) Repeat the above process to add more orders
7) Once you have added multiple stock/contracts you can see the margin requirement details on the top
8) If you wish to place the orders, click on Execute and your orders will be placed
9) The next screen will show you the status of each order
So what are you waiting for? Try leveraging the basking order facility on our platforms, now.