You are correct, INCA is an ECN (Instinet) and is the ECN primarily used by institutional firms such as mutual funds and hedge funds. Typically, they are 'smart money'. They post orders on INCA to remain anonymous, and also use features such as being able to post a sell order for 25,000 shares, but only display 1000 shares at a time. In this case, you may see someone hit INCA for 500 shares, and their posted quote will drop to 500. After the next order hits them for 500 shares, INCA will 'refresh' their size back to 1000 shares. This will continue to happen until the stock reverses direction or the entire order is filled or the remaining shares cancelled. It's anybody's guess how many shares are left hidden in this situation.
Also, note that since INCA is an ECN, their quote will represent many, many possible buyers or sellers. So, you will often see INCA posted on both the inside bid and offer at the same time. Do not misinterpret this as implying the same person/firm is both bidding and offering, as would be the case with a market maker.
-Eric |
