Having just returned from the NYSE floor, and having spent many years on several exchanges, I can say with full authority that all electronic orders with limits can and will be filled by the clerk at the best price available...and all market orders are given to the Specialist and thus "batched" which means that our limit orders are filled much more quickly. You can also test this with market vs. NX orders ...I have put in a market order, and then put in an NX order, and had the NX order filled first.- The rules that I think you are referring only apply to openings and MOC's (as far as market vs. limit priority). Just trying to keep the record straight, don't want any confusion out there (there is plenty of that already).
Don, thank you for the detailed follow-up. I will definitely try LIMITs next time. I've always wondered why it takes the respective specialist 20 seconds to fill a market order in HD or AXP even for small lots (~500 shares), while JPM fills much faster. Maybe one "bunches" more than the other. For some reason I thought that superDOT would auto-match just like ISLD for market orders. Thank you for clearing this up.
One thing to realize is DON is referring to NYSE + orders as limits compared to SuperDOT orders. NYSE+ or NX(as Don is referring to it as) is limited to 1099 shares and is instant. Retail traders though can't normally hit bids during a falling market though without bullets. Rtharp
We need to understand what SuperDot is and how the entire system works. We don't have any (1099 share) limits involved in the trades we execute on the NYSE via RediPlus. The NX option is limited on share size (NX is the NYSE ECN, and works like Island with the same limitations on price improvement). We get quicker fills at the bid or offer, but do not get the price improvement that we are so used to when using limit orders on the NYSE. I personally get price improvement on at least 25% of my orders (2000 shares x 20 orders x 2 or 3 cents adds up to a lot every day...many traders get more than I do, since the have the privilege of being able to trade more than I do). We try to keep our traders up to speed on the (constantly) changing order execution improvements on RediPlus, and the advantages involved. The important thing to remember is that you need to understand all the available execution options, and use them correctly (to save time, money, or both!. Thanks to RTharp for bringing up the questions, and I think we are on the same page now.
I only trade listed stocks and would really like to get your opinion and any information you could give me pertaining to Limit Nx. I am new to this Limit Nx and I have just a brief understanding of how it works. I would like to hear any information you could give me on how you enter your orders, I see by this thread you enter mostly limits above or below the NBBO, and you say that you get price improvements most of the time. How often do you use the limit nx feature and how would you rate its effectiveness. I find that I miss moves sometimes for placing limit orders, but I don't like to just put my order out at the market and have the specialist spread me .20 higher. I like your idea of putting your limit order above/below the NBBO. Do you usually get your fill at the NBBO or at least in the area of where the stock is printing. Once again I would just like to hear any feedback from you in response to my question. p.s. I would just like to say that I find many of your posts to be informative and I appreciate your posts.
Thanks for the kind words.... I will be happy to answer your specific questions if you want to call me (800.249.7488) mid-trading day. I will post some info back here later in the day as well.