Specialist system and alternatives....

Don Bright · May 21, 2004

Quote from Nordic:

Don, quit inhaling that cigar dude. "traders in the pit a long time...............lot's of money".....That's controlling the stock? Now I'll agree they edge as far as seeing large option orders coming into the pit, but generally their just laying off stock "delta" against their positions.

I agree, the edge from the option orders is huge...and, yes, that's the main reason we choose not to trade IBM. I'm not claiming any "conspiracy" or anything, just the ability to move big size when arbing the various instruments. And since it trades so much, it just makes sense to us to leave it alone.....

That and the spreads are too wide to bother with, LOL !!

Don

Mecro · May 23, 2004

Quote from Don Bright:

I agree, the edge from the option orders is huge...and, yes, that's the main reason we choose not to trade IBM. I'm not claiming any "conspiracy" or anything, just the ability to move big size when arbing the various instruments. And since it trades so much, it just makes sense to us to leave it alone.....

That and the spreads are too wide to bother with, LOL !!

Don

That would explain why IBM is so psychotic and in general, quite dangerous with slippage. For a Dow component and one of the highest volume stocks on NYSE, it trades like s**t.

I think being on the trading floor of any financial instrument is a humongous edge that can not be matched by any amount of hard work & intelligence.

harrytrader · May 23, 2004

It's impossible since the officials said it's impossible haha !

Quote from GATrader:

Don, padon my naivete but could u elaborate a little bit on the guys at CBOE controlling IBM? In this day and age of huge $ distributed amongst hundreds of hedge funds, how could "CBOE guys" control a widely held stock. I could see a small stock or cocoa/sugar/palladium but IBM?

harrytrader · May 23, 2004

From hedge fund manager Armstrong:

http://www.elitetrader.com/vb/showthread.php?s=&postid=401652

"... I have never denied that there is a cartel of private groups, funds, and individuals who do herd together to manipulate as many markets as they can."

murray t turtle · May 27, 2004

Quote from Don Bright:

I agree, the edge from the option orders is huge...and, yes, that's the main reason we choose not to trade IBM. I'm not claiming any "conspiracy" or anything, just the ability to move big size when arbing the various instruments. And since it trades so much, it just makes sense to us to leave it alone.....

That and the spreads are too wide to bother with, LOL !!

Don

========================================

Probably need that reminder [more in 2004] now that school is out;
bid/ask spread is too wide to small time frame trade.

I am not necessarily defending the CBOE;
but CBOE fills better when some of those derivatives are listed on multiple exchanges.

!!!

stock777 · May 27, 2004

I can't believe there are still people out there that don't realize that it's all rigged.

I'll say no more.

chasinfla · May 28, 2004

Quote from stock777:

I'll say no more.

Thanks! :eek:

*****

How about alternatives? Alternative exchanges? The ECN wave was a first salvo. The exchanges have survived those. How about some brainstorming on the next big thing?

JMartinez · May 28, 2004

Next big thing, the SUPER ECN (Auction/Dealer/ECN) market.

or a

C.L.O.B.

Quote from chasinfla:

Thanks! :eek:

*****

How about alternatives?. Alternative exchanges? The ECN wave a first salvo. The exchanges have survived those. How about some brainstorming on the next big thing?

Don Bright · May 28, 2004

Quote from JMartinez:

Next big thing, the SUPER ECN (Auction/Dealer/ECN) market.

or a

C.L.O.B.

OK, so now that the Nasdaq MM's have tried to bring business back via the "Super Montage"....(great), now they buy BRUT so that they can take even more of the competition away.... and now a "Super ECN".... ? Oh, well....at least they're open about it. And, in their favor, they are trying to get some stocks listed on the Amex (not my first choice, but still a chance to have a single location auction of sorts).

I have to have another meeting with the people at Arca... a lot of what they are trying to do makes sense...(opening auction, closing rotation, etc. for listed stocks). I'll keep you posted.

Before the "video game" of trading OTC ended in 2001, I was concerned about the direction it was taking...I'm much less concerned now.

I've seen a lot of changes over the decades, some good, some not so good....and I don't mind the exchanges making money, I don't mind the "club" making money (Nasdaq), as long as the "paper flow" is readable to those of use who work hard to "provide liquidity" and seek out "disparities"...because when all is said and done, that is all we, as traders, can do to make a good living.

Don

chasinfla · May 28, 2004

i'm trying to get a fix how the industry will digest the changes we've seen so far & what it will mean for the exchange floors.

in the long run, i suppose, the open outcry system will survive if it is ultimately viable; that is, if it hasn't been made obsolete.

i have no doubt that the organized exchange system (w/financially committed membership and operation) provides for the most orderly markets, because it provides for the most accountablility by the participants.