I'm trading in size, such that Cyber ticket charges would be significantly cheaper than my IB commisions (strictly trading the QQQ on ISLD). But, I've read on this board that there is difficultly shorting through Cyber - specifically that their software rejects shorts on a downtick unless the sale price is one tick up from the downtick. I'd appreciate any comments about any experience shorting QQQ through Cyber. Thanks.
Why don't you trade Nasdaq 100 Emini futures NQ instead of QQQs? Trading NQ is cheaper, since NQ = 800 QQQ shares and NQ commissions are $2.40/contract or lower i.e. $2.40 for 800 QQQ shares. Because there are no partial fills for buying/selling the equivalent of 800 QQQ using NQ, and NQ liquidity is better - trading is easier and more profitable, than trading the QQQs. You can always short futures on a downtick with any fut. broker. Fohat
Sadly, my edge only applies to QQQ, so I will trade them until I can develope an edge for NQ. I may have that edge already, but it is only in the testing phase :-(. Meanwhile, I wonder if I should switch brokers uhtil I switch trading vehicles.
Are you saying Cyber won't let you short QQQ on a downtick, even thought it is exempt from that rule?
No, he's asking whether Cyber will accept the order if the Q's are on a downtick. I used to use CyberTrader Pro and one of the serious annoyances to me was that if you entered a short at the bid or below, and the non-QQQ stock was making a downtick, the software would just kick it. Then you'd have to click "OK" to close the dialog box, then quickly enter another order and hope you happen to hit it on an uptick. Or you could place your short above the bid and it will get accepted but you may well not get filled if it's a fast-mover heading down. An alternative approach which would be more useful to traders would be: if the short is entered at the bid, and the stock is in a downtick, simply accept it by bumping it up .01 (thereby forcing an uptick if it is filled). But like above you may well not get filled if heading down. Or, alternately, accept the order at or below the bid, and not fill it unless the stock upticks and stays within the range of your limit. Anyway, Cyber will execute a short of the Q's on a downtick, but I'd also be curious to know if the software will definitely accept the order in the first place if it's downticking (and your order is at the bid or below). Seems like it should, but that hasn't ever stopped Cyber before....:eek:
The broker does not need to get involved in the down or up-tick. The ECN (ISLD in this case) will reject the order if it needs to be rejected. ISLD does obey the NYSE up-bid rule. But does not recognize the NASD up-bid rule, unless told to do so. ISLD has no policy to reject short sales on QQQ, since QQQ are short exempt. This means that if your order is not going through it is because your broker thought it would be a good idea to check for the up-tick itself or the could not locate a borrow on the stock, not likely on the QQQ. A side note.... ISLD does not have to obey NASD rule for shorting OTC stocks. They leave it up to the broker to specifically ask to have the rule obeyed, since the broker is the NASD member. No broker will admit that they do not make this request, but trust me when I say... many do not. Want to short your brains out in a bear market... go find a broker who has not done this.