Rules for trades being reversed in disorderly markets?

[toonerdy]

I imagine that many of us want to participate in the market volatility triggered by the British European Union exit vote. I think it would help many of us if anyone who is feeling charitable and knows about such things could provide some quick guidance, ideally with references, about the rules that various exchanges have for reversing trades that they feel occurred in market conditions that were too chaotic or somehow unfair.

The scenario that I think many of us want to avoid is that we take the risk of offering liquidity during a market panic, improving the price that our counterparties receive, but, then, after the markets revert, we are rewarded for this by having our best trades reversed or adjusted adversely.

For my trading this morning, I am particularly interested in the rules on United States exchanges for trading VIX futures, options on volatility ETF's, and maybe stocks, but I welcome any informative posts providing information about these trade reversal procedures on other exchanges throughout the world, as I think it would be helpful to collect such information in an ET thread.

I also realize that, because people are probably rather busy today, it is likely that little or nothing will be posted in time for people to plan their trades for today, but I think it would be helpful to have a thread about this topic for everyone's future reference.

If there is already an EltieTrader thread on this topic or some other web page that succinctly collects these rules, I encourage you to post a link to that. I don't mean to ask people to duplicate what others have already done. I have searched EliteTrader and the web to little avail, perhaps because I just do not know the right terms to use.

Thanks in advance for any helpful information.

P.S. I apologize for not studying up on this in advance, given that the Brexit vote has been on the calendar for a while. I have no excuse for that!

 

[Tim Smith]

I imagine that many of us want to participate in the market volatility triggered by the British European Union exit vote.

Only fools trade the Brexit. Safest place to be is on the sidelines. Risk:Reward ratio of any trade is very much on the Risk side, anyone placing a trade is basically gambling, any experienced trader knows that, and the financial industry has been making it perfectly clear of the last couple of weeks that "Sure, trade it you fool... but you're on your own" (refusing to take stop-loss orders, mile-wide margins etc. etc. etc. )

No amount of technical or fundamental analysis will provide any reduction in risk on brexit trades ! It is gambling pure and simple.

 

[lawrence-lugar]

Only fools trade the Brexit.

No amount of technical or fundamental analysis will provide any reduction in risk on brexit trades ! It is gambling pure and simple.

We're all just gambling everyday. There's somewhat varying degree's of gambling though -- some are more gambles then others.
Traders shouldn't place bets/trades...on final outcome of events though, in my opinion; trade trailing stuff instead, this is where you have a slightly upper hand in the greater picture of things.

 

[zdreg]

ideally with references, about the rules that various exchanges have for reversing trades that they feel occurred in market conditions that were too chaotic or somehow unfair

there are no rules except one unofficial rule. the rule is Goldman gets whatever Goldman decides.

that is reality.

 

[Scataphagos]

Volatility vehicles will have a gap this morning, of course. But the bigger markets have been surprisingly orderly both down and on the bounce.... not the chaos that might have any trades reversed.

 

[speedo]

If you have to ask the question, it is likely best you sit out extreme volatility. I have been day trading for years but if signal bars in my time frames are too long for appropriate stop levels, I don't trade. If a market is simply too fast, I don't trade. I don't look to make (or lose) a fortune on any given day. The markets will be here on Monday and beyond.

 

[speedo]

Scatophagos is correct, price action is good but patterns are on steroids.

 

[Scataphagos]

There's a lot of talk about panic, but the actual has been rather mild. About all the big markets have done is "test the May lows and bounce".

The B/A volume in the ES is picking up, so bigger players are coming back this morning. Expect trading to be "orderly-normal" but likely with greater volatility.

 

[speedo]

Turned out to be nice trading this morning.

 

[isotope]

We're all just gambling everyday. There's somewhat varying degree's of gambling though -- some are more gambles then others.
Traders shouldn't place bets/trades...on final outcome of events though, in my opinion; trade trailing stuff instead, this is where you have a slightly upper hand in the greater picture of things.

"If you bet on a horse, that's gambling. If you bet you can make three spades, that's entertainment. If you bet cotton will go up three points, that's business. See the difference?"
- (William F. (Blackie) Sherrod)