Regulatory vs. Informational Imbalance

Discussion in 'Order Execution' started by newdog, Jun 10, 2011.

  1. newdog



    I am really new to this so please excuse me if I have posted in the wrong group.

    So, what is the difference between regulatory and informational imbalance as given in NYSE Imabalance data feed.

  2. Sintra


    Regulatory imbalance occurs when normal imbalance is above 50.000. You can trade against a regulatory imbalance after 15:45 but not against the normal one. That is a normal limit on close order.
    You do have a closing offset order. I think it is possible to enter this one after 21:45 regardless of an imbalance. This order has the lowest priority for a specialist and comes in last. It only trades if it offsetts the imbalance.

    Hope this helps
  3. zdreg


    could you please post an example- actual or made up?
  4. Sintra


    Reg. Imblance Imbalance

    XOM -120.000 -120.000
    BP 0 35.000

    After 15:45 you can enter a normal limit or market on close order to BUY in XOM. You can't enter a normal limit or market on close order in BP(BUY or SELL).

    In both stocks you are able to enter a closing offset order to buy or sell after 15:45. The only problem is that you are not sure if it is executed. So hedging your risk is a problem.
  5. newdog


    You mean fifty thousand and not fifty?
  6. Sintra


    Yeah, sorry i mean 50,000 instead of 50.000. In my country we have the . for the , and vice versa.
  7. newdog


    Why is regulatory imbalance only for close and not for open on NYSE?
  8. Sintra


    Don't know for sure but i think that has to do with liquidity for the specialist. He could use all the offsetting to trade before market open. In the close his trading/position building is done before the close and therefor huge liquidity so 50,000 shares is no problem.
  9. newdog


    Thanks for replying to the questions and helping me getting started.

    Can you please explain it in a more detail or with numbers?
  10. Where can I get this kind of data?
    #10     Jul 18, 2011