I've read all the books, & experimented on my own. Do most of you go above the ask on island to get in a fast moving stock. How about a real liquid stock like CSCO vs a stock that only trades 200,000 shares a day? Would using the NOW feature on ARCA work better than island?
Hi, Honda I am assuming that because you want a fast fill your Day and not Swing trading, so I am sure I can speak for everyone using this form when I say a Hardy har har, oh plzzz can I go outside on CSCO and get completely screwed when it does a fakie. I play it by knowing my price level and sticking to it say thereâs a really healthy 38 price level on the ask getting eaten up you don't know if its resistance so you probly don't want to join in, you also don't want to go outside incase it halts with GSCO never leaving, not that you would get a fill if you did, but any how once 38 is out I would place an ISLD limit @38 pop on the bid and look to catch a seller, this way if I am wrong who cares because I am not going to lose much. Some might say you are less likely to get a fill this way but the bottom line is getting a fill in a fast moving market will always be hit or miss. "Would using the NOW feature on ARCA work better than island" Could someone else explain this NOW feature I have no idea what it is.
Hi Honda I can't use SOES or SUPERSOES as I'm a member of the Pacific Stock Exchange. Every market Maker must show a bid/ask on every stock. If the market is in a heavy rally /or selloff than SOES is one of the best routes. Judge how strong the move is by the volume, size of the tiers on the LEVEL 2 screen and then if significant use SOES to go above the market to be filled. Preference a market maker and hit his price. It's the best way. I can't do this but would if I could. This is one of my drawbacks. I tend to just make sure I lose the spread on ISLAND to be filled, but even then it doesn't always work. I don't trade stocks that aren't liquid. rtharp http://communities.msn.com/rtharpsland
Now orders completely bypass Nasdaq's selectnet system for faster fills using ARCA. Now orders are matched with the ARCA book, Instinet, Island or REDI.
On something like csco.. just pay up the 1/8th over market if you NEED an out. Forget arca or soes on something like that.. They will hold your order. and soes won't work. ON less liquid things... say something that only trades 300k shares.. If it's moving fast against you... just put in an island order to sell 3/4 under market.. someone will take it. THat's only if you need out. otherwise wait for the bounce to sell. As for entering, dont' bohter... you should never chase.
I can't speak for illiquid issues, although I would guess that SNET or a far out ISLD post would be the best in that situation. As for liquid issues i think ISLD is by far the best route. SOES is nearly useless in a fast moving market. You might get a fill 1 out of 10 times.
Check the "Fast-Mover Strategies" and "Fast Entry and Exit Strategies" sections of the Direct-Access Order Routing Table at: http://www.hardrightedge.com/work/orderrouting.htm
Why is this a problem for day traders, but not for non day traders?. Is it an issue of who you route your order to or what?