Mwd

Discussion in 'Trading' started by sallyboy, Jan 31, 2002.

  1. Hitman

    Hitman

    It is called a MARKET ON CLOSE print. You will NOT get that print even if you put in your order at the closing bell.

    You have to put in a MOC order to get the last print of the day, when the specialist has a huge buy imbalance (many many many stocks did, check out LXK for example), the last print will be substantially higher than prints before it as the specialist basically gather up all the shares at the highest price level and print it all in one shot.

    There are a lot of big size traders playing this MOC print every day, they have Bloomberg so they get imbalance's during the last half an hour. Depend on the market climate, average trading volume of the stock (500K in GE doesn't mean nearly as much as 500K in say LM), you can make some incredible money if you use MOC orders.

    At my firm the minimum size for a MOC is 2000 shares, and no, there is no free lunch, there are times stocks had a one million buy imbalance only to tank into the close, it is actually one of the harder games to play consistently.

    BTW, you will find it a lot more helpful if you filter your TOS to NYSE only, trades that happened on other markets mean nothing.
     
    #11     Jan 31, 2002
  2. moffitt

    moffitt

    In this new electronic age lodgeing a complaint seems to go nowhere. But you could start from who executes your orders.
    If you were entered say 30 seconds to the close I would try.
    Tell them you feel entitled to a better price. They intern should contact the NYSE floor. That help desk should check out the trades. Maybe ya get lucky and they put the Spec on the hot seat over this rape.

    In the old days a Market on close order meant as close to the close as possible. It did not guarentee the final print. But rape was not as rampant as it is these days. You can thank electronic trading for that.

    If the Book knew that there was a size buy order on the bell.
    Then he should have bundled all the sell orders and put them in on the print.
    :cool:
     
    #12     Jan 31, 2002
  3. sallyboy

    sallyboy Guest

    Hitman,

    I don't care if it was a market on close order. I trade MWD all the time and if I wait until the bell, I get very close to the closing price. If the MOC was known within the last 10 minutes it should have begun to move the market up. MWD normally trades 4 - 5 million shares per day, so if there was an order of 500,000 shares or more that in fact did move the market one dollar, then the stock price should have been moving up prior to the close. Even if it was up to only 54.50, it still should have been getting close to the final print of 55.00, not sitting at 54.00.
     
    #13     Feb 1, 2002
  4. sallyboy

    sallyboy Guest

    Granted I'm complaining about something that nothing will get done about, but that kind of action is crap and we all know it.
     
    #14     Feb 1, 2002
  5. moffitt

    moffitt

    Sallyboy
    I would launch that complaint to your executing firm.
    You have the right and maybe they get you satisfaction.
    But don't let it just slide.
    :cool:
     
    #15     Feb 1, 2002
  6. sallyboy

    sallyboy Guest

    Unfortunately I'll probably let it slide only for the reason that I didn't execute my trade at the close. The one day that I don't when normally with price action like the S&P Futures and MWD had I would have executed at the close.

    I don't know, maybe I will and see what happens..........probably nothing though.
     
    #16     Feb 1, 2002
  7. Don't know if they changed the rules during the last 3 years, but a NYSE market on close order has to be in 20 (or is it 30) minutes before the close. Once it is in it cannot be cancelled. You can enter an offsetting market on close order if there is a published imbalance. For example, if IBM has 2 million to buy market on close (and it is published), you can then enter market on close sell orders to offset the published buy imbalance.

    If the market on close imbalance is NOT published (don't remember the thresholds), then you cannot enter a market on close order after the cutoff period even if it is to offset an imbalance.
     
    #17     Feb 1, 2002
  8. vikana

    vikana Moderator

    have you noticed how it openened around 54 again. The specialist clearly took someone to the cleaners last night
     
    #18     Feb 1, 2002
  9. This is part of the MOC environment. I assume that there was a published imbalance at 20 minutes before close and again at 10 min before close. I have seen S&P add's jump $8 on their MOC orders (AOL in 1999 for example). We teach to look for these imbalances ever day and to trade against them.....

    If you were to put in a MOC sale, and then buy the stock at the 54.03 price, you would have done well. I am sorry that it cost you money, but this is not unusual at all. This is actually a benefit of having MOC order balance dissemination.

    We spend a full hour or so explaining this phenomenon to our new traders so they don't have to experience what you did.

    And, you're absolutely right...it sucks when you're on the wrong side of this!!
     
    #19     Feb 1, 2002
  10. sallyboy

    sallyboy Guest

    Thanks for the responses everyone.

    Don,

    I was on the right side of the trade, just didn't get more out of it.

    Vikana,

    Yeah, I noticed how it opened at just about 54, as if 55 never happened. I wonder if it was a misprint.
     
    #20     Feb 1, 2002