High Bid Ask Spread

Discussion in 'Order Execution' started by DANTON, Apr 8, 2008.




    I had a strange thing happen to me and wonder if anyone can explain what happened. I placed an order via etrade on Sunday night. I had a buy stop at one price and a sell limit at another. It was a one triggers all order so if the buy is made the sell is triggered. I checked the order on Monday and found that it was filled at about .45 above my buy order price and .25 above my sell price. But the current price was approx 60 cents below my buy price. I cut my potential losses and sold via a market order.

    My research as to what happened has puzzled me. According to Google, the stock opened approx 60 cents below my bid. The stock chart does not show that the stock came close to my bid-the price at which order was triggered-all day. How was the order triggered?

    Yahoo's daily stock chart does show an opening spike up to my buy price. Not at the price show by Google but at my order price. Then it drops down to the daily trade range.

    Etrade told me at the time trade was executed, the spread was about 1.10. Very large. But the bid at the exact time my order wa filled was about 80 cents below my buy price. How was my order triggered? And why was it filled at such a bad price. There were no other sellers below that price? And of all the buy orders, mine was filled way out of the day's range and then the stock dropped back down. The price I bought at is approx at the downward weekly trendline of the stock. That ask price was seems strange to me. Any input would be appreciated.




    I have not received a reply to my question. Is this a wrong board to ask a question like this?

  3. If you gave the stock symbol someone could look at the data and perhaps answer your question.


    The symbol is CCO. I bought it Monday-and promptly sold it when I saw I bought far above both my buy and sell price. So far I can't find a price on the Yahoo / Google chart for that day near the 20.23 buy stop I put it, yet the order filled. (It may have appeared on one intraday chart now that I think about it but then disappeared.) Etrade can't find a price at or above my buy price either in their records. They are doing a trade inquiry and well tell me what they find. I'm still researching this myself.

    I bought a stock with relatively low volume. Looked at the bid ask spread right after opening today and it was over $1. At approx the time I purchased the stock on Monday, it had narrowed to 10 cents. That was for today. I'm trying to find out what happened so it does not happen again to me.

  5. Go to bigcharts.com and look at 10 day and 5 day charts for CCO. There are multiple days with spikes up or down at the open.

    Use the "ADVANCED CHART" option to look at Monday on a 1 minute basis. The high at the open looks like 20.26 and the low looks like 19.51. Your broker has to answer for how real those prices are and where the trades took place.

    Unless you fully understand what can happen at the open don't trade it.


    Thanks for the reply. This stock has much lower volume that I had planned on usually trading. I will do minute by minute checks like you suggest. I will do it for all stocks I plan on buying in the future so this does not happen again.

    If you can, can you explain the phase "how real those prices are and where the trades took place"? Exactly what I am to ask about?


    I should have said I will do 10 day and 5 day charts checks.
  8. I can't tell by looking at a chart if real trades took place or if the chart shows bad data. Your broker should have access to a complete time and sales report for every stock. Your broker has to tell you if real trades took place at the spike price(s) and if the trades stood or were busted. Your broker also has to tell you where the trades took place: NYSE, ECN or elsewhere.


    Thank you for the responses. Now I will wait until I see what etrade has to tell me.
  10. You should try using stop-limits instead of just stops, then you know your maximum possible slippage, but it might not get filled.

    #10     Apr 9, 2008