What is the concept? Are we trying to buy stocks that open "too low" and short stocks that open "too high"? Can someone please sumarize the basic strategy, i may already understand it but not sure. Forexample, Friday we had futures +10. So we put in a ton of orders trying to catch stocks that open close to flat. Is this the strategy, or is there more to it? Are you also putting in orders to short stocks that open too high? I have been doing some of this only on days when i feal the tone is so positive that it has to be an up day (like friday). I put in about 10 orders to buy and got filled on only 1. But it was a beauty, i bought AIG up only 25 cents and within 3 minutes it was up over a point. Overall, i find open orders to be a distraction to my day trading. Not so much when i'm just trying to arb the open, but when i'm trying to trade news. However, I definitely can see that there is alot of money to be made taking advantage of the crazy opening prints.
What are Don's openings? I think that would be any opening or opportunity to market his firm, sell his products and services, and recruit traders.
There are at least 4 very long threads that cover this subject in more detail than you really wanted to know. Look for Don's Openings parts 1 through 4
i've seen the threads, and can't find a post that spells out the strategy. Some one save me some time. LOL. Thanks.
You basically got it right in your first post above. The idea is to capture stocks that are opening artificially low or high compared to the futures and the stock's own fair value as compared to the futures. There is a good chance that this is happening because the specialist has an imbalance prior to the open and has to take the other side, so he gaps the stock up or down. By fishing for these outside opening prints, you are trying to get on the same side as the specialist, always a high probability trade. Corey
And yes Daniel, i'm a trader. I think the way i'm going to incorporate the opening strategy into my game, is to attempt to get fills only in the direction that i think the trend is going to be after the open. I don't want to get filled on a short even if it opens way above fair value if i determine premkt that the trend for the stock should be positive. I'm a trend player during the day so i am going to try to tweak the strategy so that i'm going for opening prints that are with the trend as well. Example, If i think oil services are going to open way up and trend up during the day i will put all buys in premarket at below fair value prices. I will not also put in short orders for oil service stocks. I have been doing this some already, but it is becoming increasingly clear to me that it definitely pays to put in a ton of open orders in attempts of catching the rogue opeing prints. So i plan to try much more of this going forward.