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How do large firms and pros place orders?
- Thread starter shark
- Start date
Quote from shark:
Do you guys know what brokers and software would institutional or very wealthy private traders use to place orders? thanks.
I used to trade for a large hedge fund. We had lines to all of the brokers so we could pay them commish dollars and have them work the easy orders. The majority of our trades (millions of shares daily) were done through algorithms on our FIX connections. We used most of the large brokerage algorithms and also had some proprietary ones that our programmers put together. We also did a good deal of trading using dark pools, it's pretty cool to put a sell order of 50-100k shares of an illiquid stock with a low above the market and watch it get taken down in the dark pool all at once by some shark in there prowling around.
Quote from JCVR:
I used to trade for a large hedge fund. We had lines to all of the brokers so we could pay them commish dollars and have them work the easy orders. The majority of our trades (millions of shares daily) were done through algorithms on our FIX connections. We used most of the large brokerage algorithms and also had some proprietary ones that our programmers put together. We also did a good deal of trading using dark pools, it's pretty cool to put a sell order of 50-100k shares of an illiquid stock with a low above the market and watch it get taken down in the dark pool all at once by some shark in there prowling around.
Oh yeah, on the less sensitive positions we scanned the IOI screens and would negotiate to take the other side of large orders that were put up.
Quote from shark:
Do you guys know what brokers and software would institutional or very wealthy private traders use to place orders? thanks.
Majority of it would be proprietary in house OMS/EMS, Ticker plant, and Algos you name it. It also it depends highly on the funds business model if their a quant/algo shop they will have tons of infrastructure and connections into all major ECN's and exchanges, they will also utilize Goldman, Lehman etc.. for clearning, stock loan, sponsored access and algos that sweep the markets.
From the looks of what I've been seeing as adaytrader, seems mostly all the firms break the order up with multi-ecn programs that use some combination of passively adding liquidity and sweeping shares - rarely showing more than 1000 on any one ecn at any given moment in time.
all this hidden orders, dark pools, and market games by telephones or backroom dealings smells of classic hustling on the street, cloak and dagger, just to make few bucks on the trade or beating the market or getting a decent return on capital or making monthly profit quotas.
Quote from NY0BScalper:
From the looks of what I've been seeing as adaytrader, seems mostly all the firms break the order up with multi-ecn programs that use some combination of passively adding liquidity and sweeping shares - rarely showing more than 1000 on any one ecn at any given moment in time.
Quote from NY0BScalper:
From the looks of what I've been seeing as adaytrader, seems mostly all the firms break the order up with multi-ecn programs that use some combination of passively adding liquidity and sweeping shares - rarely showing more than 1000 on any one ecn at any given moment in time.
Yep the algos are all programmed to do this. Dark books are becoming widely used as well, with this method your trade goes into a pool that no one can look at and sits there blindly until someone elses order matches up with it. Since no one can see the order it won't move the market so alot of firms will put a few hundred thousand shares in to buy or sell with a limit price, sometime your order sits there all day unfilled, other times the whole 200k gets done at your price at once.
Quote from kickboxers:
all this hidden orders, dark pools, and market games by telephones or backroom dealings smells of classic hustling on the street, cloak and dagger, just to make few bucks on the trade or beating the market or getting a decent return on capital or making monthly profit quotas.
Yeah because if you are a trader to whom buying stock for a trade means 1mm+ shares and you put this order into the market it is going to run immediately and your trade will be gone. All of these methods let the big guys trade like they were little guys. The PM at a hedge fund who wants to day trade 500k share blocks can do it without moving the market if his execution guys know what they are doing.
How are you going to get a buy or sell order filled if your order is hidden or NOT ADVERTISED IN the STREET or MARKET!!!!!
if everybody is hidden, it's really stupid way to trade.
ban hidden or dark pools. don't play around.
if everybody is hidden, it's really stupid way to trade.
ban hidden or dark pools. don't play around.
Quote from JCVR:
Yep the algos are all programmed to do this. Dark books are becoming widely used as well, with this method your trade goes into a pool that no one can look at and sits there blindly until someone elses order matches up with it. Since no one can see the order it won't move the market so alot of firms will put a few hundred thousand shares in to buy or sell with a limit price, sometime your order sits there all day unfilled, other times the whole 200k gets done at your price at once.