So here is my question, guys. I am new to trading and I am really curious about how orders are routed to market or even not to market after they are sent. l know an exchange and also a broker have lots of routing strategies, like bats have ROUZ, ROUX, INET and smartrouting. so my question is, when i send my orders, do i get to choose which venue i want my orders to go to and which strategy I want to use, if i choose lets say BATS, do i get to see all of the BATS venues and strategies to choose from? or i just hit the bottom of BATS and then my broker chooses for me. Appreciate any answer that enlightens me, thanks
Diego, I can't speak for other brokers, but we don't charge extra for DMA, but we pass though ECN maker/taker debits and credits. So if you take liquidity more than you add liquidity, it will cost you more. If you add a lot, you will save money. In addition to that, you have to consider the quality of execution. Sending your order to the "wrong" ECN, will likely make it difficult to buy on the bid or sell on the offer, before price changes. I'd rather control where my orders are sent. Some trades just prefer to not think about it and not pay the taker fees. For them, we offer "smart" routes too. Not sure how smart they are, as most are routed to a few large equity market makers that pay for order flow. Bob
I have no horse in the race -- have never met rmorse or dealt with his firm -- but I continue to be impressed by his efforts to field queries and reply thougtfully and honestly.
Agreed. If we could actually have him weigh in on some of the issues that drive ET totally nuts (Like TA anti-TA.... or discussion about how institutions actually trade), we might actually be able to have an intelligent conversation for a change. Instead, all we have is a bunch of aliases screaming at eachother who revert to name calling when challenged. Anytime I read a post by @rmorse, I know there will be quality info contained within.
Thank you both. My feelings on strategies are very simple. If it work consistently, do it over and over until it no longer works. I will never make fun of any strategy that works. I don't care if it's TA or watching the ocean tides.
> have him weigh in on some of the issues that drive ET totally nuts (Like TA anti-TA Actually, we're blessed that he "weighs in" only when he has specific expertise. I wish others on ET followed his lead.
Actually I used to consider the full moon in my trading, which is similar. It seemed to coincide with panic or euphoria. But I'd never talk about it in public.
Bob- Do you ever hear any color on fill quality across various smart routers? (thinking of price taking in equities) I've considered moving away from IB for (much) lower commissions, but I had no way to judge the kind of fills I would get relative to IB's SMART. The slippage could easily overwhelm any commission savings many times over. I could move and find out through trial and error, but the coding project is way too big for something that uncertain.