FAQ on trading signals via Collective2.com

What do the abbreviations BTO, STO, STC, BTC mean?

When you subscribe to a trading system, you will see trading instructions that include these abbreviations. Unlike most brokers, Collective2 specifies whether each order is an opening or closing order. This:

BTO: "Buy To Open" - Buy in order to establish a new long position
STO: "Sell To Open" - Sell short in order to establish a new short position. (For stocks, abbreviation becomes SSHORT).
BTC: "Buy To Close" - Buy in order to cover (close) an already-open short position.
STC: "Sell To Close" - Sell in order to exit and already-open short position.

"I subscribed to a trading system, and I got an email recommending various trades. Can you explain what the terms mean?"

You may get an email which says:

Sell to open 200 IBM @ stop 22.75 - Likely fill at 22.80 at 2:34 pm

This means: "Enter at your broker a trade to Sell Short IBM @ STOP 22.75." (If you do not know the terms "stop order" and "limit order," see this.)

Notice that, when appropriate, Collective2 also tells you what price it expects you to have received, if you entered the order at the exact instant that the system vendor did. (This is what likely fill means).

For more general description of the Trade Signal Email, look at this.