How to trigger Set Exit or Universal Exit when 1 leg is squared off with Repair Once

[Nelson]

In this thread, we will deal with following issue:

Issue:
Repair Once works only one time in a strategy before Set Exit or Universal Exit Happens in a Strategy.

So in a Short Straddle or a Short Strangle Strategy, often after the first Stoploss or Target is hit using Repair Once condition, the set may Re-enter again as the net quantity of both legs is nil, since SL or target of both legs has triggered.
However, after the Re-entry, the Repair Once, used to trigger SL or Target will not trigger the 2nd time. This is because before the re-entry happens again, The Set Exit or Universal Exit needs to trigger first. Then only Re-entry needs to happen.

When Re-entry happens after Set Exit or Universal Exit is triggered, it will automatically trigger the Repair Once again, this can then continue for however many times you wish in your strategy.

So in below example, we will construct a simple Short Straddle Strategy, and we will trigger 1st SL or Target of either of the legs using Repair Once, and 2nd SL or Target will be done by using Universal Exit. This will enable smooth Re-entry procedure.

[Nelson]

1. So first lets create simple Entry condition, to enter a short ATM straddle at 9.30 am.

This condition will be followed with following “Position Builder” for ATM Straddle:
For Short ATM Call:

For Short ATM Put:

[Nelson]

2. Now this will be followed by Simple Repair Once Condition, where,
   We tend to exit the 1st Leg Shorted at 10% higher than Entry Price.
   Also, we want to make sure that 2nd leg is still open, since we will exit that leg from universal exit.

So the Repair Once 1st Condition will look like below:

And Position Builder for the same will look like below:

With Strike Fx Formula as :

[Nelson]

3. Similarly, this will be followed by another Repair Once (second) Condition, where,
   We tend to exit the 2nd Leg Shorted at 10% higher than Entry Price.
   Also, we want to make sure that 1st leg is still open, since we will exit that leg from universal exit.

So the Repair Once 2nd Condition will look like below:

And the corresponding “Position Builder” will look like below:

with strike Fx as below:

[Nelson]

4. Now for the most Important part, we will trigger Universal or Set Exit based on one of the following 3 criteria:

a) Time Exit of 3 PM (OR)
b) Exiting the 1st Leg, when 2nd leg has Net Quantity = 0, which means 2nd leg has got exited through Repair Once mentioned above. (OR)
c) Exiting the 2nd Leg, when 1st leg has Net Quantity = 0, which means 1st leg has got exited through Repair Once mentioned above.

So together Universal Exit or Set Exit will look like below:

[bhavesh8375]

In Universal Exit condition,
isn’t it LTP should be less than 10% lower than buy price?
i.e. LTP < entry price * 0.90

Because, we sell the instrument and to gain profit we should buy lower.

Please correct me if I’m wrong. I am bit confused with this.

[Nelson]

The above example is of Short Straddle. and buying is the squareoff with stoploss of 10%. Hence it is that way.

For Target yes, your formula would be right.

Thanks

[meetarpit]

I understand that for repair once to work properly in reentry you have written the universal exit like this but in your universal exit the 2nd leg is forcefully exited if the first leg SL is hit.
I don’t want to exit my 2nd leg unless the SL of 10% is hit.
Also I want repair once to work as usual in reentry also.
Is it already taken care of in universal repair? Am i understanding it correctly?