Dynamic level 2 offers the inside picture of a nasdaq otc nms security, such as dell, intc, msft, amat, siii etc....
It shows the various market makers and their current market prices. It shows the dynamically changing picture of the number of bidders and number of offers. You can actually see the stock getting stronger, just about to change to a higher pricing level, etc. Thus you can try tto time your purchase as the stock is getting stronger and about to move up to a higher pricing level....if their were 20 firms offering stock at 20 when it is 19 7/8 bid, 20 offered, there is no "rush" to buy it at 20...as firms move to higher price and lets say, there are only 4 or 5 sellers at 20 left, now you could make your move, knowing that it is close to 20 1/8 than when there were 20 mm's offering at 20.
level 2 might look like:
GSCO 19 7/8 PWJC 20
MLCO 19 7/8 MASH 20
MASH 19 3/4 INCA 20 1/8
in the above example, the stock would be quoted "19 7/8 twice, one at 19 3/4, offered at 20 two times, one at 20 1/8....if mash went to 20 1/8 so only one were left (pwjc) at 20, you might want to jump on the stock if you wanted to own it.
Take a look at yamner.com go to Yamner Unive, Yamner library and take a look athte screen shots images for level 2, the nasdaq market makers...also go to document download and perhaps download one of the screen cams of level 2 action. Once you see it in action you will understand.
Ultimately, level2 action is useful for getting short term high quality executions. For long term investors it might not make a huge difference except that I believe that a penny saved is one earned and shoot for all the savings I can, regarding of trading style.
Again, strongly suggest you go to yamner.com go to yamner univ and then doc download or yamn library.
regards,
steve@yamner.com |
