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Non-Tech : Meet Gene, a NASDAQ Market Maker

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To: Walkingshadow who wrote (1334)3/2/2001 9:58:17 PM
From: LPS5  Read Replies (1) of 1426
 
Before the open and all during the session, MM's have complete information on buying and selling pressure, and this determines where they open the stock.

Dealers have access to their own order flow in a particular issue, not to other firms' order flow. Nor are they able to see exactly what's going on in ECNs, in crossing networks, where an issue is trading overseas at all moments, or where trades are taking place in the third market for listed issues or in UTP books for Nasdaq issues. They can get a feel for the order flow in other market centers from the tape, but that's not always a lot of info to work off of.

So, to say that they have "complete" buy and sell information is wholly inaccurate. Furthermore, the reliability of such information in a particular issue is directly proportional to the size of the retail and institutional customer base the flow is coming from. If you had a couple of hundred retail and 20 or 30 institutional customers, the reliability of what that order flow is telling you, while good, is not nearly as good as if you had a couple of hundred thousand retail customers and several thousand institutions.

Is there any way for retailers to access supered messages?

Only on the site you included a link to, which is static and after the fact.

In real time, as you'd see on Thompson's AutEx or Bridge IOE, no. There is no retail product of that sort, only access to sellside broker-dealers at one level and buyside institutions at a second level. And that's just as well, because those are indications of interest - "IOIs" - and are not, by any means, firm. They could easily be, and often are, fishing trips (trying to see what interest in an issue, in terms of buys or sells, may be on the sidelines) as well as bona fide representations of interest. And, they come in three flavors: buys, sells, and supers, where supers are orders of a size typically above 30,000 shares (to my best recollection).

No one puts a lot of stock in what they see on these broadcast systems, FYI.

Are there other sources of buying/selling pressure that MM's have access to outside of these two sources

Simple charts, the whole range of technical analysis tools, proprietary analytics, and other mundane, home-grown programs.

LPS5
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