SuperMontage vs. ISLD Hidden Orders

Originally posted by bungrider
Yes; my take is that they aren't very common, but I have no direct personal experience, so take this with a grain of salt... Since the order is "hidden" it's not sent to the L2 book, so unless your broker (i.e. Datek, IB) routes heavily to ISLD, I wouldn't think that the hidden orders are very marketable. I mean, what's the point of making an offer if no one knows it's there? If a tree falls in the woods and no one hears it, did it really fall??

It's always been strange to me that ISLD, whose originators have been champions of market transparency and liquidity, is one of a very small # of marketplaces that process hidden orders...
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Hi bungrider-

Thats the point. Hidden Island orders are not supposed to be marketed. The idea is not to display to the other traders your moves in the market. However, don't make the mistake of thinking they are not as liquid. Restassured if you have the most competitive price on either the bid or ask and your order is hidden, it will still get hit -or- lifted (depending on which side your're on) just as efficiently as a fully displayed order.

One Example of when to use such an order in a highly liquid environment would be to cover a HUGE short position(10k+ shrs.), when prices are in a free fall on a given stock. However, you don't want all the other covering shorts to interfere with your fill. Or at least stave them off until most of your order is covered.

However, with that said I might be more inclined to agree with you on "Subscriber Only"- ISLD orders.

cheers,

momo
 
Originally posted by DATTrader


I believe you mean "did it really make any noise"....of course it fell regardless of whether anyone was there to hear it.
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(uh, get your hip boots on)

the act of the tree falling disipates energy in a number of forms, one of them being sound waves being generated as the impact and abrassion of the falling tree collides with other stable objects. hence the misdirection of thought regarding the event having significance as being measured by the ears of a human as sole determinator of whether or not sound waves were created is just that, a misdirection of ones attention away from the reality that there was a noise.

But,
what does this have to do with the price of Tea in China?
 
If the TV camera isn't rolling, then there is no news. At least that's what CNN thinks.

Just so we keep on topic of trading, if there are only 3 people watching the overnight session in a particular market, is movement of that particular market important?
 
Quote from DATTrader:





Regarding your point on getting off shorts using the shaving technique, just be aware that if you do this on a NMS stock where the spread is at one cent at the time you shave to get off the short, you have technically violated the uptick rule. And as you have probably surmised, many trading platforms will allow this. Having said that, I have never actually heard of anyone actually getting caught doing it but I guess you never know.
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nope

He's not there is no uptick rule on NASDAQ it's an Upbid rule.
As long as somebody bids higher than the last bid you can short that bid. Not as effective slowing downs shorting in a down market as the uptick rule for exchanges.

Robert
 
Quote from rtharp:



nope

He's not there is no uptick rule on NASDAQ it's an Upbid rule.
As long as somebody bids higher than the last bid you can short that bid. Not as effective slowing downs shorting in a down market as the uptick rule for exchanges.

Robert
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so theoretically, taking any offer that is above the current bid is an upbid and may be shorted to??
 
I think somone should show this thread to the sec and thereby illustrate what a mockery their rules have made or our market. No wonder institutions complain that they can not find liquidity. We now have shaved hidden orders in a fragmented market. I am not saying whether this is good or bad for the trader just that the SEC has allowed markets to fragement instead of integrate and that is not what they were intending (as far as I could tell).

Now if I were running things and I wanted a strong fair market. I would have the cost of execution incorporated into one central market place. So if and ECN charged for access the quote would incorporate that charge. So when I paid 20.10 for a share perhaps 20.05 went to the trader and the 05 went to the ecn. That would cause the liquidty to behave rationally. I would also go back to nickels so we could have some depth and as someone said on the other thread representation. What good is a penny thread if the MMM specialist has no intention of filling anyone there unless they are wrong.

My two cents after reading about shaved hidden orders. (By the way I use them cause I must)
 
Quote from rtharp:



nope

He's not there is no uptick rule on NASDAQ it's an Upbid rule.
As long as somebody bids higher than the last bid you can short that bid. Not as effective slowing downs shorting in a down market as the uptick rule for exchanges.

Robert
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Geez have you not read enough of my rambling posts to realize I would know the uptick/upbid rule on the Naz? First off, I do not believe it is an "upbid" rule as you called. I think that the "uptick" rule was established by the SEC with the various exchanges given leeway on how to define its enforcement. The Nasdaq has chosen to define an uptick in relation to the last bid price. But that is just semantics anyway.

Regarding the main point, you obviously misinterpreted the situation being discussed, as in that hypothetical scenario there was NO upbid to short to. Thus we were discussing the other opportunity to get short in Naz stocks, which is to offer stock out.

But considering the likely market conditions of no upbids (thick offers, few buyers taking them etc) joining the offer at the back of the pack will likely be unsuccessful. With many platforms, you can shave your offer price by decimals to try and step in front (eg lower by .001) which are then rounded up for offers and down for bids on the Nasdaq.

However this would technically violate the NAZ uptick rule since if there is no upbid to hit, then you must offer out at at LEAST the current bid price plus the minimum spread (ie a penny in most stocks). So if the market is 50.00 by 50.01 and the bid is a downbid, and you shave the offer price by .001 to get in front of the other 50.01 offers, then your offer would be less then the minimum spread above the bid. Get it?

Never thought I'd have to defend a seven month old post......dang listed traders:D :D
 
Quote from bungrider:



so theoretically, taking any offer that is above the current bid is an upbid and may be shorted to??
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An offer is an offer to sell.....if you take an offer then you are buying not shorting ???!!!!
 
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