What will be the end result of the elimation of bullets be on pro firms/traders?
- Thread starter gimp570
- Start date
What do you mean are traders "trying to get the best price for himself or worst?"
And of course he knew that the futures have different regs, that was not his point. You didn't get it. His point was that shorting on a downtick in the futures market only makes it MORE efficient, not less, and the futures don't have any incredible crashes, at least not as a result of short selling (if it happens, its because everyone is simply bearish.
Quote from, MrMoose:
didnt funds and program traders at big houses use them also?
Program trading in which futures are bought in an "arbitrage" trade when the futures are trading at a discount or below fair value will still require an "uptick" on the stock side of the trade in order to short stock in the index against the long futures.
This is true during normal market hours.
The trades have to be "printed" on the tape and ALL uptick rules apply. One must remember also remember that there may well be a long stock postion already on the traders books, so he might be selling long stock relative to his whole book.
Like I said earlier on this thread, time to trade futures.
didnt funds and program traders at big houses use them also?
Program trading in which futures are bought in an "arbitrage" trade when the futures are trading at a discount or below fair value will still require an "uptick" on the stock side of the trade in order to short stock in the index against the long futures.
This is true during normal market hours.
The trades have to be "printed" on the tape and ALL uptick rules apply. One must remember also remember that there may well be a long stock postion already on the traders books, so he might be selling long stock relative to his whole book.
Like I said earlier on this thread, time to trade futures.
Excellent post.
A few things.
First to all you non-scalpers out there, why is it you think that just because you can use bullets you automatically make money? In fact, most traders get killed on trying to scalp a short. Add commissions and scalping shorts is not profitable at all for the majority at all.
Second of all, check up on a few low volume NYSE stocks the last few days. The ones with heavy shorts are getting stopped dead in their tracks. Offers are sitting for HOURS if not days. With bullets, that short would actually get filled as traders clean out the specialist book and cover into the short or bring the price down to where a real buyer is willing to come in.
So institutional and high vol retail clients are feeling this as well. There is NOTHING they can do if the specialist is not willing to churn stock between himself to bring the short down to where a buyer will come in.
Third of all, this is an effect on NYSE volume and liquidity. I also can tell that the lower volume specialists are definitely not happy. A lot less day traders to screw over and that means money out of their pocket into no one's. I would not be surprised if traders started going to Naz and Futures. Definitely a slight consideration in my mind.
I want to mention that the decision has not affected my week much at all. Still, it sucks to see free money go by but I have been relying on bullets less and less weeks before that. My concern is shorting a stock without worries of getting filled at a reasonable price because no upticks are coming up. And I am not even talking about scalping a large short, just simply shorting a stock. The whole uptick rule is a bunch of crap nowdays and bullets were a way around it. I will be much happier with no uptick rule than bullets.
Just spoke with a broker who specializes in NAZ stocks. He was a former mkt maker and now manages a branch of a decent size pro firm. He says that with bullets gone, attention has shifted to NAz stocks due to easier short. I always knew that all you have to have in NAz is an upbid.
What suprised me was that he said that since ARCA is its own stock exchange, they have no tick test rules. Yu want to get short, just hit the bid w/o regard for uptick or upbid !
That can't be accurate. or is it? Anyone know?
What suprised me was that he said that since ARCA is its own stock exchange, they have no tick test rules. Yu want to get short, just hit the bid w/o regard for uptick or upbid !
That can't be accurate. or is it? Anyone know?
yours too was an excellent post, and it got me to tink-ing:
penny-anny (decimalization) has really done away with scalping (profitable and easily) as well as the short sale/up-tick rule
-- done away with it, in the sense that its economic stop gap measure and effectiveness has been watered down to near insignificance
also, regarding the Gung Fu Artist comments you quoted, in essence is stating that you personally control the price that you place your orders at.
your comments further embellished that by stating that if you puy .5million shares at the Bid, you control where you place the order at.
and you know something, you/me/which ever trader it is, really does control where the price is placed at, and that makes this discussion less material than it initially seemed