Placing Option Orders (Multi-Leg)

The steps for placing a multi-leg option order vary depending on the strategy you are using. Follow the steps below to help navigate through the process.

Entering an Order from All in One Trade Ticket

1. Navigate to the All in One Trade Ticket under the Trade Tab

2. Enter a Stock Symbol and Select an appropriate Option Strategy

3. View or Modify the Option Details for each leg, including:

   • Action

     Available Action Choices

     • Buy to open: opening a long position by buying the option.
     • Buy to close: closing an existing short position by buying back the option.
     • Sell to open: opening a short position by selling (writing) the option.
     • Sell to close: closing an existing long position by selling the option.
   • Quantity
   • Expiration
   • Strike
   • Call or Put

4. If applicable, Add A Leg: Click the Add A Leg drop-down.

5. Choose an Order Type

   Available Order Type Choices

   • Market: Order is sent at the best price available at the time the order is executed. Execution is guaranteed but fill price is not.
   • Limit Credit or Debit: Order is executed at the price you specify. Fill price is guaranteed but execution is not. Click the Net Credit, Debit, or Midpoint price to auto-populate the price or you can also manually select Credit or Debit and enter a different price.
   • Even: Order is sent at a net zero amount.

   • Walk Limit: Order operates by going to the market at the selected Start Price.

     Once entered, it will rest for the selected Time Increment and then cancel and replace the order with a new limit, determined by selected Price Increment amount. This process will continue until the order is filled or rests as a limit order at the End Price (never outside of initial NBBO).

     Walk Limit orders work on select option strategies and can be customized by specifying Start/End prices, Price Increments, and Time Increments.

6. Select the Timing for the order

   Available Timing Choices

   • Day: Causes your order to be canceled at the end of the current day's trading if the order has not been executed. All Market Orders are automatically Day orders. Orders are generally considered to be day orders unless otherwise specified.
   • GTC (Good 'Til Canceled): Instructs the broker to keep an order open until it is either executed or expires. At Schwab, GTC orders remain open for 60 calendar days unless filled or you request that it be canceled before that time.

7. If applicable, Add an Advanced Order: Click the Add an Advanced Order drop-down. See Conditional Orders Overview or Brackets Overview for more details.

8. Preview Order: When you are satisfied with the trade you are building, click Preview Order.

9. Place Order: At this point you may choose to place the order.

Adding Legs from the Chain Module

1. Type an underlying in the chains box. Select a chain. This action will be the opening trade.

2. View your leg details to the left. Select the quantity, order type (market, limit) and duration. You can see your strategy below the order box. Click Add to confirm the leg.

Adding Legs From the Position Module

You can also add a leg from the positions box by selecting an underlying from the dropdown menu in the positions box and clicking Add to Order next to the position you want to add.

TIP: All legs must have the same underlying. You may enter up to four legs.

Roll, Expand or Close a Position

1. Select an underlying from the positions drop down menu to roll, expand or close a position.
2. Choose a stock or option and click Add to Order.
3. Add a new leg from the series of options in the chains box.
4. The details of your roll will automatically populate on the left side of the page.

Commissions, taxes, and transaction costs are not included in any of these strategy discussions, but can affect final outcome and should be considered. Please contact a tax advisor to discuss the tax implications of these strategies. Many of the strategies described herein require the use of a margin account. With long options, investors may lose 100% of funds invested. In-the-money long puts need to be closed out prior to expiration, since exercising them could create short stock positions.

Options carry a high level of risk and are not suitable for all investors. Certain requirements must be met to trade options through Schwab. Multiple leg options strategies will involve multiple commissions. Covered Calls provide downside protection only to the extent of the premium received and limit upside potential to the strike price plus premium received. Spread trading must be done in a margin account. Please read the options disclosure document titled "Characteristics and Risks of Standardized Options."

NBBO (National Best Bid/Offer) Spread Quote reflects the best quotes printed from participating exchanges on each leg of the spread combined. For a long leg, the NBBO single leg “ask” quote is used, while short leg quotes use the NBBO “bid” quote to combine for a synthetic NBBO combination trade quote. Please note that there are no spread markets in securities that are subject to benchmarks such as “time and sales” or “NBBO” and therefore the “market” cannot be “held” to a price.