Will stop get taken out if there is a bad print?

Discussion in 'Order Execution' started by Nasdaq5048, Jan 27, 2006.

  1. Can anyone who has experience on the floor tell me what happens to the stop orders if the print below the stop price is a bad print?
  2. I would like to know this also especially for commodity markets like the nybot sugar and nymex gold/ silver, these markets often misprint.
  3. newfool


    Does anyone have the answer for this? TIA.:)
  4. ellokn


    Ask your broker, but in the pit traded markets, a mis print is a mis print -- which means no trade trade place at price XX, and your stop should not be hit, and a trade at or through your stop was not executed.

    Time and sales should X out the mis-prints. Depending on your data feed, you might get the scrubed data.
  5. alanm


    It think it really depends, even for pits. If your stop is being held by the floor trader, it probably won't be triggered because either he won't see the print and the market won't have moved, or he'll see the print, realize the market hasn't moved, and not do anything. If, however, your stop is held in your trading platform or on your broker's system, and it gets tripped by the mis-print and sends a market or limit order to the floor, I doubt the floor trader would question it because it looks like just another market or limit order. It's hard to imagine they would have the time (or even authority) to call back the originating firm to find out if the order was the result of a stop that was triggered from a bad print.

    If your stops are held on your trading platform or on your broker's systems, it depends on how well they are coded to deal with potential bad data (i.e. whether they look at the bid and ask as well as prints).

    If your stops are held on an electronic exchange, and someone fat-fingers a trade that moves the market through your stop, it will likely get triggered. The resulting trade may or may not be busted, mostly depending on what price it happens at. This is different for each exchange, and you need to investigate them directly to find out. GLOBEX, for example, defines price bands for different products that are used for bust decisions, and has also been playing with different solutions for the cascading-stop problem that is caused by these mis-trades.