Need Help Understanding Stock Price Please

Discussion in 'Order Execution' started by Handsome, Oct 27, 2006.

  1. Today I was watching a quote box during trading hours at my options xpress account for a stock that I own which is NWS.

    It was around 1:20pm and the bid was like 21.90 and the ask was like 21.91. It was like this for a few minutes and then all of a sudden I saw a price of $21.83 and it was in red and it was for 50,000 shares...right after that it went right back to 21.90 and then 21.91.

    So I am confused as to how did that 50k come across at such a lower price?
    What happened?

  2. Block trade done on the floor?
  3. What does done on the floor mean?
  4. Wetton


    Should you be buying stocks?
  5. Its traded on the NYSE so I am assuming it was a block trade done with a floor broker. I dont really know the specifics because I have never been on the floor and not familiar with the operations or how those guys do business.

    You have a specialist typing away madly and these guys running around with palm pilots writing on a screen. Someone made a deal.
  6. I am a new to buying stocks but to answer you, yes.
  7. Thanks Eagle. Sure was one heck of a deal that the price was so much lower than what I was watching.
    Thanks and goodnight.
  8. dac8555


    no offense, but block trades and insitutional order flow are a way of life in stocks. to keep form getting you ass kicked, you need to understand the basics of how exchnages and order flow works.
    You are going to have a hard time making money if you dont understand all the ways it can be taken form you.

    My guess is it was a clouple of different things

    1. some dumbass putting in a 50k market sell order and getting creamed.

    2. pre arranged inst buy trade...maybe off the books.

    this is a big reason why poeple need to have a "liquidity provision" in your trading plan. If you trade any size at need to have sufficent liquidity as not to move the market or not get a lousy execution.

    if oyu have an options Xpress account...and you are trading options...this is 10x more important becuse of the spread and the specialist system.

    for instance...put in a market buy order on a call with a .10 will get executed about .20 above the market...taking a HUGE percentage haircut right off the top.
  9. Thanks DAC

    Your advice and suggestions are helpful to me in my learning process..I am no trader but am interested in learning..For now I just bought 1 stock but not to trade but to save. But I learn things here everyday..(well almost everyday)

    Thanks a lot.