It really depends on the stocks you trade. For liquid stocks you probably be fine with market orders, but for stocks that trade say less that 5M shares per day, it's only the question of time when you replace market orders by marketable limit orders in your ATS.
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ATS market vs limit orders in
- Thread starter cohvi
- Start date
It really depends on the stocks you trade. For liquid stocks you probably be fine with market orders, but for stocks that trade say less that 5M shares per day, it's only the question of time when you replace market orders by marketable limit orders in your ATS.
Quote from NY0BScalper:
While I don't have experience running a live ATS, I do have a lot of experience trading on very short timeframes, and I have a decent understanding of how markets work. When you want OUT of your position, if you are chasing with a limit that's not getting filled, you are throwing money in the garbage. If you're going to chase with a limit while the market trades against you, why not use a market initially and save yourself some time? At least to exit your positions.
If not using ats, I agree with that. There is actually no much choice, unless our name is "the Flash". By using an ats, instead, you have the advantage it can compute orders on the fly based on realtime bid/ask and quickly recompute them programmatically if necessary, untill filled. Usually no repetition is necessary and orders get filled istantaneously, if prices computation is tuned rightly. So lmt orders and their monitoring are just part of the whole engine.
For long timeframe, the question may be irrelevant.
Tommaso
Quote from cohvi:
Thanks maxpi, rosy2 and NY0BScalper.
I'll run a simulation following your recommendations.
Entering positions using limit order at the price of the signal and maybe even at a one tick better price and see what comes out.
Exiting positions using limit order at the price of the signal and if the price runs away then a market order.
Thanks,
Cohvi.
I have to agree with Cohvi. For years I have been floating limit orders and stop loss orders, and found myself either chasing prices higher or having stop losses just kick in long enough to get me out of a position instances before the stop would reverse.
However, since CoolTrade introduced "stealth mode" where the system tracks the prices and keeps track of the limit prices and stop loss prices, along with other exit conditions based on rules, and submits Market orders when the conditions are met, I seldom see weird movements in prices, going against my position.
I have heard so many people say "no one cares about your measily 1000 shares". My answer is simply, "why should I tell anyone where I want to exit a position". I've seen stocks drop .06 and then reverse and go up .25 to .50. But if I floated a stop loss .07 lower, the price would go down the .07 and knock me out and then make the run up.
Especially with an ATS, I see no reason in the world to float limit orders.
Ed
Thanks for the replies.
The ATS is configured to trade the futures market and not stocks, hence there is no concern of market makers taking advantage of my market orders.
I'll use limit orders in my simulation because they can give me a more accurate result in a paper trading. When the system will trade real money I could use market orders to see the response.
Another way to go is to consult an experienced trader that can asses more accurately then me the market orders execution.
Cohvi.
The ATS is configured to trade the futures market and not stocks, hence there is no concern of market makers taking advantage of my market orders.
I'll use limit orders in my simulation because they can give me a more accurate result in a paper trading. When the system will trade real money I could use market orders to see the response.
Another way to go is to consult an experienced trader that can asses more accurately then me the market orders execution.
Cohvi.
Teh answer to yoru question is an MIT order..Market if touched placed just like a limit, but if price is touched then you get filled at the mkt.. The best fo both worlds.. whoever said earlier that they ahve never seen anyone use a market order ..obvioulsy has nevr seen anyone successful trade! I use em all teh time to enter and exit and i do well..
Quote from jaytrader100:
Teh answer to yoru question is an MIT order..Market if touched placed just like a limit, but if price is touched then you get filled at the mkt.. The best fo both worlds.. whoever said earlier that they ahve never seen anyone use a market order ..obvioulsy has nevr seen anyone successful trade! I use em all teh time to enter and exit and i do well..
Does MIT order is a native exchange order or a virtual order supplied by the broker platform?
If it's a native order, does it exist on Eurex and CME?
Do you use market orders for short term trading such as minutes or for longer time periods?