IB Level II Afterhours

Discussion in 'Retail Brokers' started by gh1, Dec 12, 2001.

  1. gh1


    I asked IB help desk this question -- but, well, that's why our commissions are so cheap. Generally, worthless reply.

    If i pull-up a IB level 2 screen (still free this month) after hours (say 6:00 pm)-- i see MM's posted Bids and Offers everywhere, and often they are unbalanced -- You know; Offer at 25.5 and a bid at 26.25 (gee there's a quick 75 cents) -- these are only on MM's not the ECN's.

    Besides the fact that i really doubt an MM is on the board at 6 in a thin stock (like ntec for example) -- i just don't know what to make of it. I would hate to get trapped on one side of a trade.
    I never play after-hours, but i had my TWS up and just happened to look.

    Any idea what is going on here?

  2. Turok


    >Any idea what is going on here?

    What you are describing is not IB specific. MMs are not liable for any of their quotes after hours. Just as the market closes you will see many but not all of the MMs roll their quotes away from the inside and those that are left are often MMs that weren't participating anywhere near the inside. This ragtag bunch of quotes are both useless and confusing.

    It is legend that occasionally a MM will float his quote around post/pre market to sway Newbie into thinking there is an arbitrage opportunity available -- Newbie then obliges the MM by doing business with him through and ECN only to find that the displayed MM quote where Newbie intended to consumate the arb deal is of course dead.

    Only use ECN quotes to determine the market after hours.

  3. Level 2 quotes at IB come from Nasdaq.

    I wouldn't expect to get any sort of quotes from Nasdaq at 6pm. If there are still quotes there, I would imagine they're stale or wholly inaccurate.

    I checked with someone at IB, they said they're going to look into it.

  4. Turok


    >I checked with someone at IB, they said
    >they're going to look into it.

    I'm confused...what is it exactly is the "it" that IB is looking into?

  5. I'm sure many a newbie (thankfully not me as I learned about it before trading) has been caught offguard pre/post market and bought from an ECN at the ask thinking they could immediately flip it to a MM at a higher bid only to find that they couldn't. They then find to their horror that the nearest ECN on the bid is 50+ cents below the ask.

    One of many lessons for us all to learn.
  6. Level 2 data is Nasdaq originated.

    IB doesn't do trading with Nasdaq after 4:00 PM.

    By these facts, we shouldn't be seeing Level 2 prices after 4PM EST. -- That is what I'm told is being looked into.

  7. Turok


    >Level 2 data is Nasdaq originated.

    Yes, this is a fact.

    >IB doesn't do trading with Nasdaq
    >after 4:00 PM.

    Yes, this is a fact. Neither does anyone else. Only ECNs have liability post market

    >By these facts, we shouldn't be seeing Level
    >2 prices after 4PM EST.

    Those facts don't support your conclusion - "shouldn't" implies there is a problem somewhere and you will find that there is not.

    I currently have 3 brokers (and have used about 5 others) and every data feed I have ever used still shows Naz LVL2 prices sitting pretty much static between close and open.

    This is not a case of "we shouldn't be seeing..." as in a technical problem at IB, it is a case of "we should be ignoring" because we have the knowledge that the MMs are not liable for their quotes.

    It's the equivalent of the sign in front of the diner that says "HOT DOGS 2 for $1" while the diner is closed. The quote is still there, but the store isn't open.

  8. Dustpuppy

    Are you saying that MM's shouldn't be able to post their Bids or Asks until exactly 9:30am? Turok is right, NOBODY can trade Nasdaq after 4pm, but they can post their Bids and Asks. You will see MM's post and pre market with any brokers L2.
    Makes you wonder what the IB rep is thinking if they admit there is a problem when one doesn't exist.

    It would be nice though if occassionally a MM was caught napping and his ridiculous bid or ask got hit at 9:30am.:)

    I have yet to see it though. :(
  9. All you have to do is 'hit' the MM first, if you really thought they were that dumb. If no trade, then you leave the ECN alone.

    Not likely to work for ya anyhow.

    MM L2 is mostly dead after 4, but not always. NITE is often trading, and if theres a very active stock, there will be some MM action.
  10. Apparently GH1 ~*AND*~ Turock were both right.

    Turock explained it exactly as I now understand it; orders are just queuing up for open and you should be able to look at them (not necessarily pay attention to them, but look at them).

    GH1 was right because he was seeing "off" prices. There was a problem that withdrawn bids and offers were not being removed. They are now (as of yesterday afternoon the change was in, it should have been applied overnight when IB's servers rebooted).

    Take it light everyone.

    #10     Dec 14, 2001