Don's Opening's Journal....

Don how long have you been trading. The reason why I ask is that I believe you have been trading for quite a while and I am a bit surprise that your entries are at low share volumes. I would expect that a person at your experience level would be entering positions of minimum of 10,000 plus per trade.
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Shortee,

I don't pretend to answer for Don. There are [at least] two reasons why one would not trade 10000 shares regardless of experience:

1) The strategy doesn't warrant it. In doing OO orders, you are easily puting in two dozen orders, and in the case of some traders, many more than that. So instead of making one big trade, you make many smaller ones. In fact, the more you get filled, the better it can be, as from a purely statistical basis, you have a greater chance that more of them will be profitable.

2) While it is a necessary condition to have experience to do large size, it is hardly sufficient. There are two reasons for this:
a) You are not psychologically suited to doing such large size.
b) You are risking too much of your stake in one trade

nitro
 
Originally posted by nitro


Shortee,

I don't pretend to answer for Don. There are [at least] two reasons why one would not trade 10000 shares regardless of experience:
nitro
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How about the obvious one: trading blocks is very different than trading kilos. Block-sized orders give traders and specialists something to shoot at, while smaller orders simply trade with the rest of the noise. For that reason, trading blocks would seem to involve a lot more understanding of where other players are positioned, how deep they are, etc. Trading block sizes using the same indicators and prices as you would for small orders would seem to reduce your advantage. Whether that is made up for by the increased volume depends on the other factors I mentioned, I think.

P.S.: There's obviously nothing magical about the number 10,000. I refer to blocks as orders whose size overshadows that of other orders. That size, of course, varies widely by stock. Like you'd need a whole truckload of KM to move it a penny :-)
 
I'll pretend to answer for Don....and most of the answers above are true. What happens in many stocks is that there is a number of shares that comes in "under the radar" - easy in, easy out, and doesn't have "cause for pause" with the Specialist. I have my Redi set 99,000 shares as a hard limit, and at times will trade in big blocks (to save commissions, and yes, I pay commissions too!!)...but most standard trading is at the 2-5 thousand level.
 
Had only one opening today but good enough since it was an ok winner, SBC long that was. Good weekend everybody, in additon thanks to all of you that makes this thread worthwhile:D
 
My opening program "burped" on me this morning and shut down Redi by mistake (yes, it happens to the best of us)...no openings, darnit!

Another note of caution (which shouldn't come as any surprise), but a few have been trading FRE and FNM both on the openings. This is ok, but the chance of getting filled on the buy (or sell) on both stocks is high...and this is not likely to end up in a pair trade.

I suggest that if anyone chooses to use any strong "pairs" that they only use one for the opening only order.

Just trying to help!! :-)
 
Originally posted by Dustin
Don,

Does Bright offer NYSE Openbook or NetworkNYSE? Also, if you wouldn't mind commenting on these tools...
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Since there is a delay on the "open books" they are really of no use to our traders. If, at some time, they become of value, we will be glad to offer them (or any tools) to our traders. So far, no reason to......
 
Originally posted by mgkrebs
Is this as simple as using a larger envelope for the higher beta stocks for entry, as well as giving them more room to wiggle in terms of risk control?
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No, this means adjusting your overall percentage indication of where the market (SPX) is going to open for each individual stock according to its beta. Unadjusted the indication only really applies to those stocks with a beta of 1.

E.g. if the SPX is set to open up 0.5% statistically you should expect a stock with a beta of 2 to open up 1%.

Dave
 
Originally posted by dlincke


No, this means adjusting your overall percentage indication of where the market (SPX) is going to open for each individual stock according to its beta. Unadjusted the indication only really applies to those stocks with a beta of 1.

E.g. if the SPX is set to open up 0.5% statistically you should expect a stock with a beta of 2 to open up 1%.

Dave
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Good answer,but I like to add that we also keep in our journal the "shake outs" and the "slingshots" (not technical terms, obviously)...for our individual stocks. I think I explained how to fix those problems a few posts back (fingers getting tired trying to keep up with Hitman)..:-)
 
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