Level 2 quotes aren't really level 2 quotes

Discussion in 'Order Execution' started by nararbee, Sep 21, 2006.

  1. nararbee

    nararbee Guest

    Anyways this is my first post, but I have been trading for 3 years now. My questions: Isn't kind of obsolete using just regular level 2 quotes if you don't have access to the ARCA Web Book and the INET soon to be Nasdaq/Brut/INET book as well? I mean my current level 2 just shows the best/ask for arca, brut, etc. Also isn't pointless looking at the size of the bid and offers if you can hide most of your order. If you see arca offering 100 shares at x price but really has 10,000 shares. Doesn't that defeat the purpose of transperency?
  2. bingo.
    that´s why they call it an iceberg.
  3. pretty much. has not been very useful since 2001... i imagine some are using it as a reverse indicator...
  4. nothing is what it seems, unless you don't believe it.
  5. Toonces


    There are several data providers that show the entire ecn books. Who do you use?
  6. nararbee

    nararbee Guest

    Right now I'm getting my level 2 quotes from TD Ameritrade. They used to offer the ECN book from INET, but becuase of the merger with NASDAQ they terminated that. But I was doing some research and found out that TOTALVIEW actually has pretty in depth coverage of the level 2 spectrum. It does cost $14 a month. Do you guys think that' is worth the cost. Also I'm thinking about switching brokerage companies. I've thought about going to IB, but from all the messages I've read it seems like they have crappy customer service. Suggestions?
  7. Lucre


    I don't think l2 is totally worthless. If there's size, it's for real. It's just if there's not, it might not be for real. If volume's high and size is low, that's a good sign of gaming.
    With brokers, you need to find one that offers the services you want. They all compete on a combination of price and services.
    If you want (need?) a broker to answer in 3 rings, you need to pay for it, just like you need to pay for l2.
  8. Level 2 is very usefull. But you have to learn to recognize the difference between a real and a fake bid/ask, as well as knowing when there's an iceberg around there...

    after a while you learn to do a little bluffing yourself. It's a game of deception, and power, but a game none the less.
  9. kjsnow25


    volume high and size low is gaming? It's stat-arb flow. Large difference.....focus on the "alrge volume part"....
  10. large volume + low size= lots of fun:D
    #10     Sep 28, 2006