please help me understand NYSE liquidity

fatman · Mar 11, 2003

I have read every post on ET and all the NYSE/SEC links, but I still don't understand how it is possible for the Specialist to do prints that are outside the displayed bid/offer. Can anyone explain this to me? How is it possible for a print to go off 30 cents away from the quoted bid/offer.

THIS IS DRIVING ME NUTS!

Thanks.

bungrider · Mar 11, 2003

by deliberately not updating the B/A quote when it changes...

50% of the time or better, the B/A you see is not really the true market. this depends on the stock. i've found that the thinner stocks tend to show the true B/A in a more timely manner, but i haven't traded thin stocks in some time, so this may have changed along with everything else about NYSE.

the hardest thing for me in switching from thin to thick stocks was this.

ghostrider · Mar 11, 2003

is the NYSE has opened the flood gates of shitty fills and ignored orders....

Free Thinker · Mar 11, 2003

when the specialist has a big order to fill he may have to reach for the shares. that means he may have to go up or down a few levels in the book to find enough shares. when he gathers up enough shares he will do a print at whatever level he had to go to to fill the order.usually he will print and change the bid \ask at the same time.
under the rules at this time (sounds like it may change soon) he is supposed to give everyone between that level the same price.

chasinfla · Mar 11, 2003

understand the shell game, and you'll understand the NYSE.

fatman · Mar 11, 2003

Quote from vhehn:

when the specialist has a big order to fill he may have to reach for the shares. that means he may have to go up or down a few levels in the book to find enough shares. when he gathers up enough shares he will do a print at whatever level he had to go to to fill the order.usually he will print and change the bid \ask at the same time.
under the rules at this time (sounds like it may change soon) he is supposed to give everyone between that level the same price.

As I understand it that is how the system should work. Unfortunatly the big prints that are far away from the market do not seem to clean out the specialist book. Just one example was to day in PG the stock was 80.50 x 80.51 and a print goes off at 80.80 for 10000 shares. This order did not take out the size in the book at 80.55, 80.59, 80.60 etc. that size was still there.

Is it possible that this print was actually a block that was negotiated away from the floor, but still went on the tape?

I just want to understand!!!!!!!!

Avalanche · Mar 11, 2003

Quote from fatman:

As I understand it that is how the system should work. Unfortunatly the big prints that are far away from the market do not seem to clean out the specialist book. Just one example was to day in PG the stock was 80.50 x 80.51 and a print goes off at 80.80 for 10000 shares. This order did not take out the size in the book at 80.55, 80.59, 80.60 etc. that size was still there.

Is it possible that this print was actually a block that was negotiated away from the floor, but still went on the tape?

I just want to understand!!!!!!!!

I don't know what platform you use to trade but most NYSE tape reader type traders will create a time and sales or time and quotes that only shows the NYSE prints.

Trust me if you are not able to just view the NYSE prints or atleast know where all the prints are going off it is impossible to make sense of the prints. I had that problem myself.

If that 10K print didn't take out the size in the spec book then my guess is it was a regional print on a trade that was done a few seconds (or more) earlier and you are probably just seeing it hit the tape.

LionTrader · Mar 11, 2003

Late prints hit the tape all the time. Some large prints are truly done on the floor, and reported late.

Also, market orders can hit between quotations all the time.

fatman · Mar 12, 2003

Quote from Avalanche:

I don't know what platform you use to trade but most NYSE tape reader type traders will create a time and sales or time and quotes that only shows the NYSE prints.

Trust me if you are not able to just view the NYSE prints or atleast know where all the prints are going off it is impossible to make sense of the prints. I had that problem myself.

If that 10K print didn't take out the size in the spec book then my guess is it was a regional print on a trade that was done a few seconds (or more) earlier and you are probably just seeing it hit the tape.

Thanks, my timeand sales is set up just fine and i've been using it for awhile. perhaps it was a late print. it just seem like it has happened sooooo much more in the last month than ever before.

Ron In-a-sauna · Mar 12, 2003

Quote from fatman:

As I understand it that is how the system should work. Unfortunatly the big prints that are far away from the market do not seem to clean out the specialist book. Just one example was to day in PG the stock was 80.50 x 80.51 and a print goes off at 80.80 for 10000 shares. This order did not take out the size in the book at 80.55, 80.59, 80.60 etc. that size was still there.

Is it possible that this print was actually a block that was negotiated away from the floor, but still went on the tape?

I just want to understand!!!!!!!!

are you sure it was a NYSE print, sounds like it may have been on another exchange if it didnt "clear the book" as you said... didi you have an order in, where was it routed to, did you get a fill...

OH, and as far as the new liquididty thing, its just "the man" trying to keep us good traders down! but we shall overcome! LOL