This is the reply I received from IB when I asked some details on the odd lot issue. I do not know if this is clear enough.
The New York Stock Exchange (NYSE) has an odd-lot order system. However,
the NYSE has formulated a policy that does not permit certain types of
trading with respect to odd-lot orders. Although the NYSE has advised that
it is recognized that some types of buying and selling on the same day may
be appropriate, for example, a customer may buy stock using an odd-lot limit
order and then enter a stop loss sell order against that position, IB has
decided to NOT PERMIT THE ENTRY OF OPENING ODD-LOT ORDERS for NYSE-listed
products.
The NYSE has advised that the following are not permitted:
(1) unbundling of round-lot orders to submit the unbundled orders as odd-lot
orders;
(2) failing to aggregate odd-lot orders into round-lot orders;
(3) entering both buy and sell odd-lot limit orders for purposes of
capturing the spread in the stock;
(4) order entry practices (not defined) intended to circumvent the round-lot
auction market;
(5) index arbitrage;
(6) other types of program trading or any pattern of activity that would
suggest day trading, - not including PRL's (part of round-lots) - which may
not utilize the odd-lot limit order service. Examples of this latter
practice could include among other things, entering multiple odd-lot limit
orders to buy and sell the same security on the same day or limit orders to
buy and sell a group of stocks on the same day where it appears or is
established that the intent is to capture the spread in these stocks by
buying on the bid and selling on the offer. However, such trading would not
be precluded from using the odd-lot system if (rather than limit) odd-lot
market orders were utilized.
Odd lot orders are permissable through Nasdaq.
The New York Stock Exchange (NYSE) has an odd-lot order system. However,
the NYSE has formulated a policy that does not permit certain types of
trading with respect to odd-lot orders. Although the NYSE has advised that
it is recognized that some types of buying and selling on the same day may
be appropriate, for example, a customer may buy stock using an odd-lot limit
order and then enter a stop loss sell order against that position, IB has
decided to NOT PERMIT THE ENTRY OF OPENING ODD-LOT ORDERS for NYSE-listed
products.
The NYSE has advised that the following are not permitted:
(1) unbundling of round-lot orders to submit the unbundled orders as odd-lot
orders;
(2) failing to aggregate odd-lot orders into round-lot orders;
(3) entering both buy and sell odd-lot limit orders for purposes of
capturing the spread in the stock;
(4) order entry practices (not defined) intended to circumvent the round-lot
auction market;
(5) index arbitrage;
(6) other types of program trading or any pattern of activity that would
suggest day trading, - not including PRL's (part of round-lots) - which may
not utilize the odd-lot limit order service. Examples of this latter
practice could include among other things, entering multiple odd-lot limit
orders to buy and sell the same security on the same day or limit orders to
buy and sell a group of stocks on the same day where it appears or is
established that the intent is to capture the spread in these stocks by
buying on the bid and selling on the offer. However, such trading would not
be precluded from using the odd-lot system if (rather than limit) odd-lot
market orders were utilized.
Odd lot orders are permissable through Nasdaq.
