Priority of limit orders

Discussion in 'Order Execution' started by ProgrammerGuy, Aug 23, 2007.

  1. PersonA: entered a limit order @ 100 at 9:50
    PersonB: entered a limit order @ 100 at 9:51
    PersonC: The specialist, he hasn't entered anything yet

    Time is now 9:52 and everyone wants to be matched with the market order

    There is a market order for 100 shares that has to be matched. Who gets priority?
  2. Not enough information to answer the question.
  3. You need to read the rules of the market that this order is resting on. Priority is be different on different exchanges/ECN's.
  4. rayl


    First we need the limit prices.

    Also, the exchanges for each order. Each exchange has its own rules.

    And even then, there is still a bit of uncertainty due to the Reg NMS and exceptions to protected quotes (e.g., if an exchange isn't responding promptly).

    If there is any generalization, it's priority by price, then time. But at same price, specialist is at back of line on NYSE (same for options MMs on all US options markets except for Arca) and MMs cannot trade ahead of customers on GMS (but this needs to be complied with before the order goes into the book).