How to create Ladder

What is Ladder?

Ladder is a visual presentation of series of trades that you will be performing through the STM strategy. Different steps of the ladder will be denoting the No. of steps taken upside or downside.

Create Ladder

Check the Total Cash Left in your account. It is the remaining cash that you can use to create new ladder.
You can also add more paper cash if required.(If using the simulation mode of trading)
Click on the ‘Create Ladder’ button present at the bottom of the screen

Select Stocks For Creating Ladder

You can select the stock from options available as-
1. Select stocks by sector
2. Select stocks by Name/Ticker
3. Recommended stocks based on extra cash
4. Recommended ETF’s based on extra cash
To create two ladders for the same stock you will have to re-visit this page. When you re-visit, select the same stock again and create a new ladder for that stock.
You can also remove the selected stocks if you wish to remove it from creating the ladder.
Now, click on the ‘Assign Cash’ button to assign the cash to your selected stocks.

Assigning Cash To Each Ladder

You need to assign cash to all the stocks that you have selected to create a ladder in.
You can take reference from Unallocated cash and Extra cash shown here to get an idea of how much money you totally have to allocate to the new ladders.
Once you are done with the allocating the cash you can also change the sequence of creating ladder.
Click on the checkbox present at the top right corner of the app to enable sequencing.
Hold the stocks and move them to decide their sequence.
Then click on the ‘Confirm Assigned Cash’ button.

Confirm Cash Assigned

Check the current price of the stock while creating ladder.
Confirm the Cash Assigned to particular stock.
Click on ‘Proceed to Detailed Ladder Creation’.

Step 1: Set Target Price

Enter the Target Price according to your analysis and the current price of the stock that you have selected.
You can also set the TARGET PRICE MULTIPLIER which indicates the multiples in which you can have your target price according to the current price of your stock.
Then click on ‘Select Ladder Initial Buy’ to move further.

NOTE: Target Price is a price by which the customer expects to sell all his shares. This price is always higher than the Initial Buy Price (At least 20% higher and maximum 50x of Initial Buy Price). As the price rises the app sells a fraction of shares at different prices until the price rises to the target price. Once the price is higher than the target price there are no more sell orders since all shares have been sold.

Step 2: Initial Buy Qty

INITIAL Buy Cash is calculated from cash assigned to the stock.(It is usually 50-80% of the initial cash allocated).
Initial Buy Cash= Cash allocated x (2k- 2)/(2k-1)
K=2 (K=Target Price/ Initial Buy Price)
Then accordingly INITIAL BUY QTY. is also calculated from Initial Buy Cash.
Buy Qty. = (Initial Buy Cash/ Initial Buy Price)
You can check the formula by clicking on the ‘Show Formula’ Checkbox present below each of the parameters.
After calculating Initial Buy Qty., click on ‘Select Ladder Step Size’.

Step 3: Select Step Size

The app provides you with the suggested steps above, and the step size, you can change the values as per your choice(It should be within the range shown below each parameters). The app will calculate the actual values as according to the calculations.
With Initial Buy Qty. and No. of Steps above, Order Size is calculated.
Order Size= Initial Buy Qty./ Na
Step Size is calculated with Target, Initial buy price and Na(No. of steps above) by the app.
Similarly Cash Needed is also calculated with Order Size, Nb(No. of steps below) and Recent Buy Price.
Cash Needed = Order Size * Nb (Recent buy price/2)
You can check the formula by clicking on the checkbox present below each parameter.
After Calculating all the parameters click on ‘Show Ladder’ button.

Review Ladder In Tabular View

You can now view the tabular view of your ladder on this page.
Other parameters are also shown below the tabular presentation of your ladder.
You can also see the Graphical View of your ladder by clicking the slide button present on the right side above the tabular presentation.
Or you can directly Save the ladder, by clicking on ‘Save Ladder’ button.

Graphical View of Ladder

You can see the Graphical View of your ladder on this page.
The red dots in the graph show the sell order executed.
The blue dots in the graph shows the buy order executed.
The other parameters of ladder are shown below the graphical presentation of app.
Click on the ‘Save Ladder’ button to complete the process.

Save Ladder and Start Trading