is this true about a limit order in general

Discussion in 'Order Execution' started by ChrisMMM, Aug 23, 2007.

  1. You will only get filled if the market is moving against you.

    Someone said that you rarely get filled at limit orders when the market will move in the direction or your trade because the specialist will fill his orders and not yours. But when it moves against you the specialist will then fill your order.

  2. duard



    And to take it a step further a trader can game turn around time by floating limit order trial balloons. If they aren't getting filled then guess what you are probably going to make money you just have to make it a market order. One way to keep anal stretch to a minimum is to break the order up into smaller pieces, that way if you go market on 100 share lots and rapid fire away as long as you are getting reasonable fills you avoid the "market maker vig."
  3. mde2004


    Agree, Your limit will trade through and lose money 80% of the time, use trade triggers for best results.
  4. This is total, complete nonsense.

    By definition, one places a Limit Order at a price that one WANTS to fill.
    Therefore, by definition, the VAST majority of Limit fills are a "good thing".

    "you limit will trade through"

    This poster knows jack shit about statistics.

    The market spends the vast majority of the time randomly bouncing around...
    Which means that an even if a monkey places a Limit Order...
    There is a 50/50 chance of the market going either way after the fill.

    If a talented, experienced Quant places the Limit Order...
    In order to exploit a market inefficiency...
    The odds are significantly in the Quants favor.

    In addition...
    ONLY Limit Orders give a trader the opportunity to profit from the bid/ask spread...
    Which is still substantial for a lot of stocks...
    Especially in volatile markets like we've seen recently.

    This is so basic... it's not even debatable.
    If you don't understand my post... you should probably stop trading.
  5. What is with these newbies dogging limit orders. A limit order will ALWAYS be filled if you hit the bid or ask. If you need to get in during a quick move, just sweep the bid or ask .03. I never do this, but if you're a momentum chaser, that's always an option. At least you're guaranteed the amount of slippage that you allowed.
    I never use market orders, ever! And I always get into the moves that I want. I trade 20,000 shares+ daily. Take some friendly advice and drop the market orders.
  6. It is important to distinguish between a non-marketable limit order and a marketable limit order. The former offers liquidy, while the latter takes liquidity, much like a market order. I believe that your discussion of limit orders vs. market orders is actually intended to discuss non-marketable orders vs. marketable orders.

    It is impossible to make a blanket statement that either taking or giving liquidity is the superior strategy. The answer always depends on other aspects of your trading strategy, and also depends on current market conditions. Some strategies and traders do best always taking liquidity, or always giving it, while others need to adjust this choice to changing market conditions.
  7. Ever since we had the hybrid, limit orders are much better than market orders. You have to be very sure of the trade to go market and be prepared to pay for slippage.
  8. mde2004


    I was making a joke newbie. There ain't no need to holler.
  9. With NYSE Hybrid there is no difference in speed execution between a marketable limit order and a market order up to 1 million shares. Both orders will be crossed automatically (unless the market is slow).
  10. rayl


    Interesting! Can you say a little bit more -- esp on the following 2 points:

    1. Is there a rule that requires providing 1MM shares in liquidity at the inside quote by (I assume) the specialist? (if not, I'd assume the marketable limit order can exhaust available liquidity and have the quote move away so the remainder of the order won't fill).

    2. What if the inside quote is from an ECN and not from NYSE -- does your statement still hold?
    #10     Aug 26, 2007