Bid/Offer vs. ?

Discussion in 'Strategy Development' started by tenfly, Jan 16, 2004.

  1. tenfly


    I have an odd question..

    I started trading in an odd environment where Bid/Offer was the way. Maybe it was the stock I was trading. I dunno. But I've been reading in another post that bid/offer is a dumb strategy. I guess it's all a matter of opinion.

    But..I ask..What is the opposite of the bid/offer strategy?
  2. Turok


    I assume it would be called the hit/lift strategy but I would hardly call either of them a "strategy".

    Of course if I misunderstand you I am not knowing.

  3. tenfly


    So hit/lift, is that basically punching in and out of a trade and not waiting to be hit on the bid or offer?

    Maybe strategy is the wrong word as well..Maybe methodology?
  4. Momento


    there is no opposite to a Bid / Offer strategy...
    the other way around would be simply giving up spreads?!


    you can trade on momentum, lifting an offer while offering back higher... but what is your question again?
  5. tenfly


    I don't really know my question lol

    Simply, I've seen people posting "Bid/Offer" is a dumb way to trade blah blah blah..I guess my question is, if bidding and offering is so dumb, then what is the er..un-dumb way of doing it (according to them)..

    Maybe I should ask them lol..
  6. Turok


    >So hit/lift, is that basically punching in and out
    >of a trade and not waiting to be hit on the
    >bid or offer?

    Yes, I would hit your bid or lift your offer if I was on the other side of your trade and you were using the bid/offer strategy/methodology.

  7. nitro


    There is no dumb strategy, only dumb strategies on a given symbol.

    Generally, in fast daytradring momentum environments like most equity trading, you will hear that you don't want to offer stock or bid for the stock at or inside the B/O. It is "ok" to bid or offer stock outside the B/O if you are playing tradethroughs.

    The reason is that in the case where you are trying to make a market inside the b/o is that you are essentially trading against momentum since you are a stationary target for momemtum trading, and belive me, rarely will you get filled in fast moving stocks if you simply bid or offer for them and the momentum is going your way - no one that stupid survives very long doing that on something like QLGC.

    Whereas if you lift offers or whack the bid, _you_ can choose to trade with the trend only when the momemtum is going that way.

    However, take note that longer time frame "trading" often will put in bids or offers at technical levels. This is because most of those strategies aren't sensitive to giving up the short term momentum.

  8. I think you are talking abouut Buying in front of big Bids and Selling in front of the big Offers? If this is true, then it only works when the buyer is agrresive . Doesn't pertain to selling, since bullets are no more. Anyway this strategy works some of the times, depending on market conditions.
  9. Since Swift Montreal was the first to get into the bid/offer game and I was involved with it I can tell you were it going now. The TRUE bid and offer game is now done by computers. While a ton of traders still do this the numbers are not what they used to be and will only get harder. This is why bid/offer guys have become bid/offer MOMO players. the bid/offer concept is done with momo stocks. this has allowed traders to trade 2-3 mil shares a day and pay next to nothing (or even make money)while participating in the upside of the stock.Guys who make only credits are now making P/L as well as credits. This type of trader has a much better chance of staying around longer then only bid/offer guys. The Swifts model is to teach a guy ONLY to bid/offer and have a 1000 traders do this. For the time being this is working but in a year or 2 where will they be. To only know 1 style is trading is plain NUTS.