Zerodha launches ATO; all you need to know about Alert Trigger Orders

Here are the benefits and step-by-step guide to create ATO orders on Zerodha's Kite platform.

Discount brokerage firm Zerodha today, September 17, announced the launch of its new trading feature on its desktop-based Kite trading platform namely - ATO (Alert Trigger Orders).

ATO - Alert Trigger Orders facilitates users to set pre-determined alerts that can result into actual trades as and when the set conditions are met; thus enhancing trading efficiency.

Unlike standard alerts, that are programmed to alert traders about variable developments in day-to-day stock market trading; Zerodha's ATOs takes it a step further by enabling the user to take advantage of the desired market action, by facilitating order execution as and when the conditions are met.

 

In simpler words, ATO is not just an alert but also actual execution of the desired trade - all in just one single feature.

Announcing the launch of the service, Zerodha, founder and CEO - Nithin Kamath said the ATO feature will be soon be available on the Kite mobile platform too.

Alert triggers an order (ATO) was on our to-do list for a long time, and we just launched it on Kite web.

ATO orders allow you to execute trades based on If This Then That conditions.

For example, buy Reliance if Nifty 50 crosses 25000 or execute a nifty short straddle (sell a… pic.twitter.com/aOwy315l4P

— Nithin Kamath (@Nithin0dha) September 17, 2024

 

Zerodha on its post based on ATO also explains that its new feature the user can link a basket of orders to an alert, and as soon as the alert is triggered, the orders are placed on the exchange. Thus, it saves time and ensures that the user does not miss out on opportunities.

Explaining the benefits of ATO, Zerodha shares that orders can be placed across cash and derivatives segments. Additionally, ATO can also help in risk management. Here are the 3 examples shared by the brokerage firm: 

Investing in stocks/ ETFs based on index levels: Zerodha explains that if the user wants to invest in ETFs when the Nifty 50 index drops to 23,000. The user can create an ATO for when the Nifty reaches 23,000 - as and when this condition is met, the order to buy these ETFs will be placed on the exchange, without any human intervention needed.

Taking positions in F&O: A derivative trader may want to take a short straddle trade when Nifty hits 25000; the user just needs to set an alert for the Nifty 50 at 25000, and link orders to sell both call and put contracts when this trigger is hit.

Managing risk with ATO: This feature can act like a stop-loss order, especially for traders holding multiple positions across stocks and derivatives, explains Zerodha. For e.g. if the user would want to exit multiple stocks or F&O contracts as and when an index or stock rises or falls below a certain level; the user can simply create an ATO accordingly.

Steps to set up an ATO on Zerodha:

Step 1: Click 'More' on the desired stock/ ETF/ derivative contract

Step 2: Select 'Create alert' and ensure checkbox ATO

Step 3: Define your conditions, including price points

Step 4: Search for the instrument where the trade needs to be executed (For e.g. if you want to buy a Nifty Call as and when Nifty falls 1% below 25,400 - in that case, you need to define this condition as in Step 3; and in Step 4 you need to search for the desired Nifty Call you want to buy, the price or select 'Market'' and click on 'Create Alert'

And finally, in case, the user wants to modify or delete an ATO; the user will be able to see the ATOs under - Orders / Alerts New