Bid is buyers, Ask is sellers ???

Discussion in 'Order Execution' started by Digs, Feb 6, 2004.

  1. Digs


    Bid is buyers, Ask is sellers

    When a stock like RIMM has a 10c spread, and moving fast upwards, buying at the bid is a tough job...

    So how do you buy at the bid, is this a use of Buy limit orders, I guess I have missed something..please advise


    Just from reading your post, I don't think RIMM is a stock you should be playing.
  3. Digs


    thanks for very little...
  4. hit that market order button dude, don't over analyze lol
  5. You would use a limit order but
    when something is moving up fast theres no way your going to buy at the bid.
  6. if the bid is like 20.10 and the ask is 20.20, you could put a buy limit order for like 20.11. but if the market is moving up fast, your order may not get filled.
  7. I think it depends on your trading style.
    If you trade breakouts, then you may just have to trade at the market prices.
    If you trade support/resistance, then you may be able to buy at bid and sell at ask.

    Myself, I've never really mastered S/R trading so, most of my orders are mkt or lmt.

  8. Digs


    Thx that makes sense...
  9. Digs


    Index trader,

    When posting a stop- imit order, how much do you allow for the spread btw stop and limit ???
  10. Turok


    >So how do you buy at the bid, is this a use of
    >Buy limit orders, I guess I have missed something..
    >please advise

    Correct, if your buy or sell limit orders are not marketable they will become "bids" and "asks" (or offers). If your bid/offer becomes the "inside" (meaning best) then you *may* get hit/lifted and then don't have to pay the spread. Your bid/offer may occasionally even get hit/lifted when you are not on the inside but it's not to be planned on.

    The problem with this strategy is that unless you know the stock and it's participants REALLY well, you just end up chasing liquidity from the wrong side of the spread (in other words the prints are all going off on the other side) and it costs you more in the end.

    Oh, and VOLUME is absolutely right.

    #10     Feb 6, 2004