Hi @nijinwilson @Arun_Ramachandran @Avinash
I would like to clarify that it is completely normal for multiple Algos to trade the same instrument. While the instrument may be the same, the reason for entering the trade is entirely different for each Algo.
Let me explain with an example.
Most of our Options Algos select contracts based on their moneyness - that is, whether the option is ITM (In-the-Money), ATM (At-the-Money), or OTM (Out-of-the-Money) - along with their own predefined trading logic.
Now, suppose two different Algos generate an entry signal within a short span of time. If the market hasn’t moved enough for the moneyness of the option contracts to change, both Algos may naturally identify the same strike as the most suitable instrument for their respective setups. As a result, they can end up trading the same option contract.
However, this does not mean that the Algos are taking the trade for the same reason. Each Algo has its own entry criteria, risk management, exit conditions, and overall trading philosophy. The instrument may be common, but the underlying logic behind the trade is independent.
This is also one of the reasons why, when building a portfolio, it’s important to look beyond just the instruments being traded and instead focus on factors such as the strategy type, market behaviour, risk profile, and correlation between Algos.
I hope this provides clarity.