QQQ cancel charge

Discussion in 'Trading' started by Nordic, Feb 13, 2002.

  1. Nordic


    Do other traders clearing firms, (including pro) pass through the supposed AMEX QQQ specialist 25 cents a cancel charge? The AMEX specialist supposedly charges all cancels.

  2. The QQQ cancel charge was a pass through by the specialist in the QQQ ,Susquehanna Investment Group. It is possible due to competition from the NYSE,ISLD & REDI, that they are not charging for cancels anymore. Check with your introducing broker to see if you are being charged these cancelation fees.

    According to an AMEX floor governor I spoke to, the specialist can
    add these charges legally. However, since the QQQ's have other
    routes, the AMEX specialist will lose business.

    Gene Weissman
    Lieber & Weissman Sec., L.L.C.
  3. Nordic


    Thanks Gene, can they pick and choose or would this apply across the board. I'm told all SUSQ is charging "everyone".
  4. They must be able to pick and choose as I have traded QQQ's through the AMEX at Echo for years and have never been charged for a cancel.

    For anyone just starting to trade the QQQ's I have to say though, while I used to send every order to the Amex, I do everything I can to stay away from that guy now that there are other options. I primarily use Island now for the QQQ's.

  5. TraderJimR,

    It is possible PAX clearing or ECHO are picking up the costs for the cancels . I believe the AMEX specialist may not be charging
    for cancels now, due to increased competition.

    We include all pass throughs in our rates for NASDAQ , including REDI,ARCA,ISLD,INCA & SOES.For most traders,this cost will offset any cancel charges I can only speak for our firm,if you have any questions on charges, please talk to your broker.

    Gene Weissman
    Lieber & Weissman Sec., L.L.C.
  6. What is the best source for trading the QQQ's?
  7. Magna

    Magna Administrator

    Just follow the Q's on your Level2 and you'll see who is usually at or near the inside, who is the most liquid, etc. Usually ISLD, REDI, ARCA, and NYS are within a few pennies of each other, and all provide better executions than the ASE.
  8. Nordic


    Gene, so these cancel charges are "real" and its up to the firm's as to pass them through?
  9. Nordic,

    Cancel charges are real. As I said earlier, the firm may pass the charges thru to the trader. This cost only applies to AMEX transactions on QQQ's, that are cancelled.

    The best route to use would depend on your objectives, size
    and order execution platforms routes. On REDI+ , I have routes to
    AMEX,NYSE,NYSE Direct,ARCA,INCA & ISLD . What route do I use?
    If I am getting out of an odd lot, I use ISLD. If I am trading 5000
    share blocks, I would send the order to the AMEX for potential price improvement ,assuming I know FV of the futures and I have
    the potential for price improvement .If I am taking 1000 shares on
    the offer and the NBBO is the same for all exchanges, I would send the order to NYSE NX(direct), for an auto Ex. For pure speed of execution ISLD and the REDI ECN are the fastest providing there is an ECN match. ISLD ECN may be a little faster. Note that the ISLD ECN is not "proactive" and ISLD will not accept market orders. ETF(QQQ,DIA & SPY) value is related to arbitrage, so most of the time the markets will be fair. That does not mean that the execution will be the "same" in all markets. The "width" of the Bid-Ask spread most of the time in QQQ will be .02 or less.
    If you trade mainly ISLD, you are giving up potential price improvement for speed of execution. Liquidity in ETF's like any
    product, may depend on market conditions. As a former SPY Market Maker on the AMEX , many times MM keep the spread wide
    to keep from getting "picked off" by arbitrage traders.

    Gene Weissman
    Lieber & Weissman Sec., L.L.C.
  10. Nordic


    Gene, thanks for the very efficient answers to my posts. Your information will help.
    #10     Feb 13, 2002