Hedging Mistakes.

Discussion in 'Trading' started by Avalanche, Jul 24, 2002.

  1. Does anyone in here use the emini's mainly as a hedge against mistakes.

    By this I mean, you don't actively trade them. But if you are in multiple positions long or short you have access to them as a hedge.

    For example. some days I find myself very long and WRONG. or visa versa and I know that if I am in 5 different positions and if they are NYSE stocks for example, I know that the bids are about to get yanked, and that it is going to take me a while to get out of them.

    what I would like to do is short something quickly that will help me balance things out while I am working to get out my longs

    I use SPY sometimes but if the market is really getting thrashed...the ecn's pull and when I give an order to the AMEX guy....it takes forever and a day to get filled and I feel like the slippage is just horrible. (What is the best way to insure a fill on the ETF's in a fast market? Arca market, or give it to the specialist?)

    It seems like emini's would be the best way to "hedge" being really wrong while you are trying to get out of several things.

    How do you guys do it?

    Also, can someone here answer the following question.

    If a stock is running, are you more likely to get a faster fill using a limit order way above the current offer, or a market order on NYSE. Not an NX order but just a regular limit order.

    I have heard that you never want to give the specialist a market order...it is better to use a limit order and try and avoid him all together. Just use a limit order with the price that is a good deal away from the inside price.

    Can someone elaborate on this.


    oh one more question. When these program trades go off and stocks are bought and sold. How are those orders usually routed Do they go through superdot or what? How do the institutions know the stock will be there. I hit bids and offers all the time and get partialed. Don't they.

  2. Trading Qs on IB I got nowhere with the Smart routing that went to AMEX or wherever. I loaded Island and use market orders to move fast. Rarely read my executions report but going by the P/L displayed it never exceeds 15$ on 500 shares to enter or exit. More often it seems like 7 or 8$ and very fast. No experience with SPY DIA. I go by the P/L statement because I can never remember the bid/ask/last when I need to do something fast.