[crazygringo]

I'm curious. Do trading platforms automatically adjust existing limit orders the night of August 24, e.g. dividing all prices by 4? (Or just cancel all limit orders?)

I mean I would assume they do, but just wonder if there are ever any severe "gotchas" with a stock split with certain existing buy/sell arrangements, or derivatives etc.

[marvin]

I haven't worked on trading systems in the US, but handling this type of gotcha is the bread and butter of the sort of trading software I have been working on.

There's a million tiny details like this that can cause consequences that are both different from what a customer intended and what our terms with said customer states, so making sure it's all handled in a safe way is just part of daily business.

[bollockitis]

I can’t imagine working on software that could have such potentially disastrous financial consequences, so kudos to you and all of the developers who do this kind of work.

[chollida1]

Exchanges automatically cancel out GTC and GTD orders when splits occur.

Options are also split to take the stock split into account.

Trading platforms shouldn't have to do anything unless they are faking GTC orders by resending them out each day as Day orders.

But if your vendor is doing that then, get a new vendor as that's completely bush league.

[pantaloons]

A confusing and incorrect comment all around.

Exchanges do not receive or handle GTC or GTD orders, see for example the NYSE pillar spec.[1]

Broker-dealers handle stock splits and the behavior varies according to your broker. Some brokers will request the broker-dealer cancel all orders back, but most brokers allow limit prices to be adjusted for orders "below the market" (buy limit orders and sell stop orders). The Fidelity FAQ is an illustrative one.[2]

I'm not sure what a "vendor" is here, but brokers send GTC orders to broker-dealers, who forward them to the exchange every day as a day order. This behavior is industry standard and certainly not bush league.

[1] https://www.nyse.com/publicdocs/NYSE_Pillar_Gateway_FIX_Prot...

[2] https://www.fidelity.com/trading/faqs-order-types

[chollida1]

or you know, your wrong:)

https://www.nasdaqtrader.com/content/ProductsServices/Tradin...

it is true the the NYSE eliminated GTC orders. That just means you can't use them on NYSE, which doesn't affect my point:)

You'll have to flesh out your point more if you still feel like you have one:)

Given that I've written more than one trading systems for a living, I'm going to take my 20 years of experience over a random internet troll.

[pantaloons]

I work for a large wholesaler and wrote the code that handles client GTC orders for on behalf of pretty much every brokerage in the US. Whatever your experience is, it's no longer correct. NASDAQ stopped accepting GTC orders in 2015, before NYSE.

Here is the specific rule relating to adjusting the price of open orders: https://www.finra.org/rules-guidance/rulebooks/finra-rules/5...