Conditional orders are a risk-management tool that can be most effective if markets move rapidly. These orders trigger buys and sells automatically under conditions set by the trader which means investors can lock-in possible gains or minimise losses even if they are not watching the market.

“Conditional orders can help take the emotion out of trading as well as keep investors on course with their trading strategies,” said Darren Moglia, head of broking at Westpac Online Investing.

“By making these conditional orders free to all of our investors, we are providing practical and effective tools to manage their trades and protect their potential profits,” Mr Moglia added.

Westpac Online Investing is the first to offer a full range of conditional orders free of charge. Other trading platforms offer these orders, but they usually come at a price. The price investors pay can be higher than any gains made on shares traded.

“Conditional orders are not new to the market but we believe offering them free of charge will encourage investors to employ sound risk-management trading strategies that provide peace of mind,” Mr Moglia said.

Two of the most popular conditional orders are:

Trailing Sell Order – allows you to protect your profit on a rising stock by trailing the market as it moves up and automatically selling your holding should the share price drop suddenly to, or below, your trail stop value

Trailing Buy Order – can maximise value when purchasing a stock that is trending down by hitting a trigger when the market falls to, or below, your start price and purchasing the stock should it subsequently rise to, or above, your trail stop value.

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