What is a GTC (good till cancelled) order?
In one line: A GTC (good till cancelled) order stays open across days until it fills or you cancel it; option sellers use it to buy back a sold option at a set price without watching the screen.
How it works
A normal order lasts one day. A GTC order lasts until it fills or you cancel it. Most brokers keep it only for a set number of days, then drop it. The limit differs by broker, so check yours.
For a seller, the usual GTC order is a buy-to-close. You sold a put for $1.00. You place a GTC Limit order (options) to buy it back at $0.50. Then you stop watching. If the option's value decays to $0.50 next week, the order fills and the position is gone with half the premium kept.
That's how many sellers in the wheel strategy run the "close at 50%" rule without sitting at a screen. Theta does the work; the order waits for it.
An example (hypothetical)
XYZ trades at $50 (an illustration, not a trade idea). You sell a 45-day $45 put for $1.00 ($100) and place a GTC buy-to-close at $0.50.
| What XYZ does | The GTC order | Your result |
|---|---|---|
| Drifts to $52 over two weeks | Fills at $0.50 on day 14 | +$50, position closed early |
| Sits at $50 for 40 days | Fills at $0.50 on day 38 | +$50 |
| Falls to $46 slowly, then recovers | Fills at $0.50 on day 42 | +$50 |
| Gaps to $38 on day 10 | Never fills; the put is worth $7.00 | Assigned at $45: −$700 + $100 = −$600 |
The order handled three good rows for you. It did nothing in the bad one. A GTC order to take profit is not a stop. There's no order waiting to cut the loss unless you placed one.
Why it matters for sellers
The GTC order turns a rule into a habit. "I'll close at half" is a plan. A GTC order at $0.50 is the plan actually in the market, working while you're at your job.
Two catches. First, it only covers the good outcome. If the stock falls, you still need to make a decision by hand: roll, take assignment, or close at a loss. Second, forgotten GTC orders fire. If you roll the put to a new strike and leave the old GTC order open, it can buy back an option you no longer hold, which opens a new long position you didn't want. Cancel the old order whenever you change the position.
Our theta decay guide shows why the fill usually comes earlier than you'd expect.
Questions
Why do option sellers use GTC orders?
To buy back a sold option at a set price, often half the premium, without watching the screen every day. Time decay brings the price down; the order catches it.
Does a GTC order protect me if the stock falls?
No. A buy-to-close GTC at a low price only fills when the option gets cheaper, which is the good outcome. The bad outcome needs its own decision.
How long does a GTC order last?
Until it fills or you cancel it, up to the broker's own time limit, which differs from broker to broker. Check your broker's rule, and cancel it yourself whenever you roll or close the position another way.
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