Market makers threaten to cut me off?

Discussion in 'Trading' started by NanoTick, Sep 1, 2006.

  1. I have been with a direct access firm for a while. I am strictly day trading (large caps, about 20 trades per day). Most of my trades are market orders and routed to several market makers. I do this mainly to avoid ECN fees and also get better fills. Limit orders is not an option for my method, so I can't trade for rebate. Everything has been fine (profitable). Recently, the firm informed me that the MMs are complaining about my "abusive" use of the routing and threatening to cut me off. The firm explains that MMs in general don't like day trading order flow. Here are my questions:

    1. Has anyone run into this type of problems before?
    2. Why MMs don't like day traders? All my orders are market orders and they should make plenty of spread out of me.
    3. I initially came to this direct access firm for its low commision, now I figure if I'm forced to use ECNs for my market orders, the fees plus commision is actually much higher than most discount brokers, so does it even make sense to saty with this firm?
    4. Could I run into the same problem with a non-direct broker (like Ameritrade, Scott..)?

    Any feedbacks are appreciated.
  2. what ya talkin about?
  3. he's absuing the auto execution system. i went threw it years ago by peppering thousands of orders to get autoexec fills. there's guys on here that know what i'm talking about. no fill in the world can touch an autoexec fill. on a nyse stock it can be 300x1 lot size the stocks flying and you can pepper the system with 10 500 share orders and get instant're nailing the mm who's filling these orders automatically and when you abuse the system it affects all the other customers of the firm as they shut it off
  4. So does a MM have a legal right to refuse someone's orders even no rules are violated?

    Or it's the broker want me to leave for whatever reason?

    Perhaps I can report this to SEC?
  5. I only do about 20 trades a day. Market orders, nothing out of ordinary.
  6. 20trades a day....utterly absurd imo.
  7. I was doing from 60 to 200 trades a day on the qqq and was banned by MM.
  8. I agree...your broker is the one who doesn't like it (for some odd reason)...need to know more. Who the broker is, and how exactly are you routing? NYSE stocks or just Naz.?

  9. ja, second that...would like to know more about what u trade and where u route.

  10. if you are routing through a mm and cancelling orders all day - they will get pissed.... remember they are taking the opposite of side of your trade no questions asked .....
    #10     Sep 2, 2006