skewing a quote

Discussion in 'Risk Management' started by chuck.norris, Jun 17, 2010.

  1. Hi Forum
    Have you heard the sentence "Skewing a Quote"?
    Do you know what does it mean , why we do that and in which trading or market situation is it important to do that?
    P.S...Off course I am a beginner
  2. HSky


    I think it means to manipulate buy large bids/offers as far as I know
  3. rosy2


    it probably refers to adjusting you're quote while making markets depending on your inventory. so if you long you would lower your bids with lower size and lower your offers with more size
  4. Josef K

    Josef K

    I've heard market makers use the phrase in reference to moving one part of the quote further away from the NBBO than the other part. For example, a market maker might normally keep his bid and offer for a particular stock both .05 away from the NBBO. But based on certain market conditions or technical indicators he might decide to move keep the bid .05 away but move the offer .10 away from the NBBO, so that he is more likely to be a buyer than a seller. His quote is then skewed towards the buy side.