shorting ETF's- have to mark "short"?

Gene Weissman · Mar 5, 2003

Just a note. Why does a security that is short exempt have to be marked sold short? This does not make any sense to me. All ETF's are short exempt to my knowledge.

Gene Weissman
E-Brokerage, LLC
gene@ebrk.com

MACD_addy · Mar 5, 2003

Lescor,

I'm with Gene on this one! If ETFs have to be marked SS its news to me, and I am sure alot of other traders out there as well.

mgkrebs · Mar 5, 2003

Quote from lescor:

What I mean by marking a short sale as such is that you can only get filled on an uptick. A short sale in the specialists book will only get filled on an uptick. Some software will make sure you only get filled on an uptick. But if the market is dropping fast, good luck hoping for a good price on an uptick.

With Echo's twisted logic, you are not allowed to hit the bid in an ETF unless it's moving up.
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I've been told by Echo that is does not affect the fill. You get filled on a downtick no problem. THis has been my experience. They asked me to mark them short and I complied. No difference in my fills.

ArchAngel · Mar 5, 2003

The ETFs don't have a downtick rule.

lescor · Mar 5, 2003

How do you usually execute etf short trades? Do you send a limit under the bid? What markets? Ever try to nx the nyse posted bid? I am not with Echo anymore, but I'd be interested to know if you can hit 'sell short' at the nyse bid price and get a true nx fill. Also are you using EchoPro (formerly Sterling) or EchoTrader2 (formerly Instaquote).

As an aside, I got my first ever deleted post on ET in this thread for saying I didn't like the way the Van Buren management was running the show at Echo now. Touchy!

Quote from mgkrebs:

I've been told by Echo that is does not affect the fill. You get filled on a downtick no problem. THis has been my experience. They asked me to mark them short and I complied. No difference in my fills.
More...

mgkrebs · Mar 5, 2003

Quote from lescor:

How do you usually execute etf short trades? Do you send a limit under the bid? What markets? Ever try to nx the nyse posted bid? I am not with Echo anymore, but I'd be interested to know if you can hit 'sell short' at the nyse bid price and get a true nx fill. Also are you using EchoPro (formerly Sterling) or EchoTrader2 (formerly Instaquote).

As an aside, I got my first ever deleted post on ET in this thread for saying I didn't like the way the Van Buren management was running the show at Echo now. Touchy!

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Limit order 2 or 3 cents under bid, ARCA or Island. Have not tried NX so can't answer that one. Using EchoPro.

(Where you trading now? pm if you like.)

tdoc · Mar 5, 2003

Seriously, would one of you prop traders mind explaining to me if you have to account for your individual trades for taxes? Do you just receive a single form (1099?) at the end of the year?

Thanks!

rtharp · Mar 5, 2003

I don't trade ETFs usually and Andover's Hammer marks shorts/sells automatically as it is already built into the software.

I heard one of the head guys in risk control at another firm I know a little bit about was calling new traders telling them when they were trading the QQQ's or SPY that they could just use the sell key there was no need for the short key. The news of this thread is surprising to hear. I'd call the exchange directly and complain.

rtharp · Mar 5, 2003

Quote from tdoc:

Seriously, would one of you prop traders mind explaining to me if you have to account for your individual trades for taxes? Do you just receive a single form (1099?) at the end of the year?

Thanks!
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Prop traders don't account for individual trades it's one of our edges. The form is a K-1 though not a 1099

Bond Trader · Mar 5, 2003

Lescor -
Is someone at Echo arbing ETFs? If so, this may explain Echo's requirement "for everyone else" to mark ETFs as short sales.