Equity Intra-day bid/ask Spread Trade

Discussion in 'Professional Trading' started by newmansk, Mar 27, 2008.

  1. newmansk


    Does anyone on this spread trade stocks with wide spreads between the bids and offers?

    If you're familiar with what I'm talking about do you know if there is any books, articles on this strategy. So far I have found nothing on this stuff.

    If you need further clarification just ask me and I'll try to explain further.
  2. explain
  3. newmansk


    I'll give a brief example of this Startegy

    You're Trading Stock A with Bid at $90.10 and Offer at $90.30.
    Can use the level II to analyze the BIDS and OFFER, you are trying to enter just below or above the bid and exit just below or above the offer.

    You take a position on Stock A $90.15 and exit at $90.25. The stock has to have low volitility cuz you can get killed if there is a big move against you once in position.

    If anyone is familiar with this startegy I was wondering if there was any information available on this strategy?

  4. ntmf


    I know what r u talking about.
    This only happen on those "not so active" stocks, or "very high price" stocks.

    For the "not so active" stocks, maybe you can get in the gap, but probably you can't get out because no one fill your order.

    For the "very high price" stocks, although there's always a big spread, the price of stock move so fast that you don't know which way it will go.

    So basically, it's good to catch a spread, but don't use this as a strategy when u r trading.