Don Bright

Warrior4g · Dec 27, 2007

DON,
can you please explain in laymans terms what this is and how its done/

"We can place "Opening Only Orders" with the NYSE, pre-market, so we can take part WITH THE NYSE SPECIALISTS when stocks gap up or down each morning. "

cashonly · Dec 27, 2007

Don Bright · Dec 27, 2007

Quote from enforcer99:

DON,
can you please explain in laymans terms what this is and how its done/

"We can place "Opening Only Orders" with the NYSE, pre-market, so we can take part WITH THE NYSE SPECIALISTS when stocks gap up or down each morning. "

Well, thanks to Cash Coyne for the links from a while back...some things don't change much, LOL.

All night long orders come into the NYSE to either buy or sell large quantities of liquid stocks. If there are way more to buy than to sell on an individual stock, then the Specialist will go to his book of orders, and up the price to a level where he can fill the excess buy orders. He, by rules, must only "accomodate" - and has to be a seller (in this example). For 25 years, I want to be on the same side as the Specialist on these morning gaps.

I put in about 100 orders each morning, 200-4000 shares each on 50 stocks. I hope to get filled on 5-10 or so, knowing that I should be able to make money "with" the Specialist. He will open the stock as high as he can since he will be participating. I cover in the next few minutes. Between 70%-80% win/loss ratio.

We use fair value, and envelope sizing to minimize excessive risk, and layer to take maximum advantage of larger gaps.

All the best,

Don

Warrior4g · Dec 27, 2007

how do you know which stocks to pick? and this is based on what?

Don Bright · Dec 27, 2007

I just start with the S&P 500, trading volume over a couple of million shares, priced from $20-$60 or so...watch for earnings, news, and sector related moves, check pre-opening indications (of course), and go for it. We have people who have made over $100K in a day (record is about $400K I think). It takes use of capital, but has been one of our most consistent strategies over the years.

Don

Warrior4g · Dec 27, 2007

you don't worry about buying a gap up and having it tumble? how do you protect yourself and how do you keep track of some many stocks when you may have to exit very quickly? how many shares do you normally buy? are you saying you just buy the open? can anyone do this?

Matt24SPFL · Dec 27, 2007

*subscribed* =)

Can't wait to come over and meet you and get started, Don.

Thanks for your contributions.

hilojack · Dec 27, 2007

Quote from enforcer99:

you don't worry about buying a gap up and having it tumble? how do you protect yourself and how do you keep track of some many stocks when you may have to exit very quickly? how many shares do you normally buy? are you saying you just buy the open? can anyone do this?

Actually, I believe the strategy is to fade the gap. Don wants to trade with the specialist, who is required to take the opposite side of the trade. And if we know anything about specialists, they don't like to lose. So you set up a basket (Don was kind enuff to give you his criteria for selection) and hope for the best. Share amounts will vary based on account size and typical volume for individual stocks.

Anyone can do it, you just need a big enuff account, good trading platform, and balls. Or pretty much the same things that make almost any strategy successful. Good Luck!

lindq · Dec 27, 2007

Quote from Don Bright:

We have people who have made over $100K in a day (record is about $400K I think).

Don

Great. What was the record loss for a day?

Don Bright · Dec 27, 2007

Quote from lindq:

Great. What was the record loss for a day?

I think the same guy lost about $40,000 on day, he's pretty quick at getting out of losers, and has patience (more than I) with his winners.

He is, by no means, typical. We do have traders, however, who do nothing but the openings and make a good 6 figure income.

Happy New Year!

Don

Don Bright

Bright Trading, LLC