how does adding liquidity work?

im always here guys at prop firms saying they get paid to add liquidity. can you give an example as to how it works?
thanks

 

another term i hear is "all in" or something like that.

 

I think you're referring to "providing liquidity" - which simply means, for example, that you place a bid on ARCA 1 penny below the NYSE bid, and wait for somene to hit your bid. They pay you .002 for providing. The person who hit your bid pays .003 for taking liquidity.

So, we often "park on ARCA" take on NYSE, keep the net.

Don

 

do you have to sign up for that at a prop firm don or does it automatically happen?

 

Depends on the Firm, and your desire. We offer two types, the "all in" type, where you get a single price regardless of taking or providing liquidity...or where you get your standard rate, plus or minus liquidity. Trader's choice.

[Don