Quote from Avid_Consumer: ...as recently as today in a symbol that trades about once every 3-5 minutes (and far far less than that on nyse), i'll send an order to hit his nbbo bid, and 2-5 seconds after he receives me, he prints at that level and moves it down without filling. It certainly does sound like front-running, but it's so obvious, it's hard to imagine someone thinking they could get away with it, so let's keep an open mind and try to find another explanation. The only logical one is that he's holding a marketable sell order that came in before you, possibly with time discretion to allow him to wait for a better bid to show up (is this possible?). What is the nature of the strategy? Is it possible that someone else is trading it? It would be instructional if you would provide the specifics so we can all look at the tape and see what happened. It might also be good to forward a list of a few of these instances to your broker for an explanation from the NYSE, to which you are entitled. With an illiquid stock, there's not a lot of wiggle room to say "stock ahead" or "fast-market" and it would be good to hear the explanation. initially it would happen without any print, then i started leaving my orders active and calling them in. since then it still happens, albeit with a print. What do you mean by calling them in? Calling IB to call NYSE and ask for a fill? Are you definitely routing your order to NYSE (not SMART), and is it a straight LMT DAY order?
"It appears that my work here is done. Special Defense Team Crusaders and keepers of the Faith, you are free to go onto the next challenge of our trading security" --- (sorry, couldn't resist). LOL.... Trade where you like, enjoy yourselves!! Don
I'm very surprised where this thread has gone, started as an initial observation on the NYSE specialist, has gone to personal attacks on the most informed trader on this board (Jim), as used real examples to substantiate his observations. I still have yet to see somewhere state in clear example fashion why the specialist system is better than NAZ or ECN, Mr bright mentioned "adding liquidity for centuries" , no one is disputing they do that, what we have been saying is the specialist system is outdated and easily manipulated by one party (the specialist), hence a better trading platform is the Naz and ECN's Incidentally take a look at some manipulated stocks today on the NY, look for the spread, size on bid ask, and disappearing size- i.e MET, OMX, X (usual culprit) Hope to clarify and please provide some real examples of the greatness the NYSE has not provided thus far.
You guys all have a very good points and solid arguments about the possible unfair trading process provided by the Specialist from time to time. Is it possible to team up and raise this concern to the NYSE Chief Executive Officer? He will probably listen to you guys and regard your suggestions. I agree that electronic trading is more efficient than the conventional method (The Specialist). The fact that NYSE had acquired ARCA show their intention for a step forward for an electronic system. The electronic system will eventually replace the specialist, seem like inevitable it's just a matter of time.
You're right....I think the Hybrid will have the best of both worlds...and am looking forward to it. Don
I think most nyse traders don't defend it because it's better. They like it because they know how the system works and they work with it to make money. More efficient means harder to make money with. Look at the P/L thread and compare the number of nyse scalpers to ES scalpers.
You and I agree, of course....it's the old "be careful what you wish for" - a "perfect market" is no market at all. I just don't understand all the hostility. Don
the specialists take money out of the market. why wouldn't we have a more active, liquid and volatile market if everyone on the field had lower transaction costs in the absence of this massive toll taker? which has more intraday volatility, the nas or the nyse? the rest of the world uses electronic matching. look at pratically any equity market on earth compared to the US since the proliferation of electronic trading. (obviously there are other issues involved, fiat currency for one). when did the US get so anti-competetive? the NYSE and ASE epitomize this obsolescence in a sense.
The NYSE has been "electronic" for decades...and has NX for years...it's just a "single place" marketplace versus a "fragmented marketplace" - which allows for larger size and lower volatiility....Who would buy 50,000 shares "blindly" 1,000 shares at a time when they could "negotiate" a fair price...and everyone involved gets price improvement....this is the primary reason for a single place market. How could you negotiate a price and who would you negotiate it with? Traders do better with "predictability" than they do with "volatiility" - and tape reading allows for more predictability in my mind. Just another point (no arrows needed in response, LOL). Don
Really? A perfect market is no market? Care to explain this? I thought a perfect, frictionless market is the orgasmic goal of capitalism. Don, the hostility is understandable since for many, many years the specialist system has been one through which a number of people enrich themselves due to their position of power and authority. It is not fair and as such, those who suffer from it agitate for it to change. Those, like yourself, who gain from it, of course wish for the status quo to continue. That is understandable.