What percent of the volume does one need to be to be the AX

Discussion in 'Trading' started by ELR, Mar 26, 2012.

  1. ELR


    I had the pleasure of trading a very substantial account of a trusted friend about two years ago for several days while friend was not able to trade.

    Anyway, was trading some stocks that had daily average volume of roughly 700k shares, nasdaq stocks. I traded about 100k shares in one of them. Stock was under some selling pressure but when I stepped in and bought 10k, then another 10k, and kept doing this for about 60k shares, I saw all the smaller traders jumping in and taking it higher. I kept buying it on way up. Went up $1 from my average entry price, closed position out end of day.

    Point is I never FELT the market before this. I would enter my order for 500 shares or 1k shares and that was that. But with larger size, one actually feels the trade, you can feel it if it is good or not. If the market absorbs your size easily...bad sign. If it is hard to buy....good sign. On losing trades I woud be able to halt the losing for a while by buying more and then exit at better prices.

    I also had similar successes in the ensuing days until buddy came back from his surgery. Trading that large size was ironically much easier and less nerve racking than smaller size. Maybe if I was caught in a trade where a BIGGER TRADER came in and ate my lunch, would have been different.

    So my question....at what point does one become the ax? What percent of the volume does one need to be to be top dog in that stock?

    Any thoughts appreciated.