April 16th chat at #MBTrading re: ISLAND
<RHD_> 3As everyone know we recently added ISLD routing to the MBTrader. This feature allows to bid/offer stock
on the ISLAND book. I have asked Mike W. (BiLow) to offer us some helpful hints on how to use this new feature
correctly. So with that, Bilow take it away....
[10:07] <BiLo> Ross asked me to spend a few minutes talking about the Island (ISLD) order execution system
[10:08] <BiLo> I have been using the ISLD through RealTick for some time now. I am not an expert, but I can share a
few things about the system that may be useful to those of you new to ISLD.
[10:08] <GGomes> Is there any way to save all this to file??
[10:08] <chpp> do you have the software that wont allow partial fills on island?
[10:09] <BiLo> Please hold the chat to a minimum for a few minutes while I give a brief overview of ISLD...then we'll
open it up to discussion and questions about the system..
<RHD_> 3Please hold questions
[10:09] <chpp> or can some clown hit you with a 25 share order and the order gets killed?
<RHD_> 3chpp, please hold questions, thank you
[10:10] <BiLo> I'd like the expert ISLD traders in the group to please bear with me thru the overview. Please correct any
blatently incorrect statements I may make, but otherwise hold your opionions and experiences with ISLD for the
discussion period. TIA
[10:10] <Duncan3> GGnomes: click on the upper left corner of the room window, click on Logging
[10:10] <BiLo> I assume most of you have had a chance to use the ISLD system by now
[10:11] *** Mav-away is now known as Maverick^
[10:11] <BiLo> It is not the magic bullet to end all your trading woes...it is just another order routing and execution
system MB has added (along with SOES SelectNet and ARCA) to increase your odds of getting your orders filled. Each
of the order routing systems (SOES, ARCA, Selectnet and ISLD) has its place in your trading strategies..Today we will
be talking about ISLD..I will try to give you some background that will help you to understand the system and use it
most e
[10:11] <BiLo> ISLD is an ECN meaning your orders are posted to the ISLD electronic order book which lists all buy
and sell orders for a particular stock that come in through the ISLD routing system I believe the ISLD book is
administered by DATEK
[10:11] *** Tradegood is now known as Geren
[10:12] <BiLo> Any buy and sell orders posted to the ISLD book at the same price are crossed (executed) immediately.
.. you are trading with an someone that has posted an opposing order on the ISLD book at the same price as yours
[10:13] <BiLo> If your order cannot be matched within the ISLD book (meaning there isn't an offsetting order currently
on the ISLD book) it sits on the ISLD book until an offsetting order comes in to match against your order, or until your
order is cancelled.
[10:14] <BiLo> MM's can execute against ISLD orders by preferencing ISLD thru selectnet
[10:14] <BiLo> While your order is awaiting execution on ISLD it will be displayed on MB's Level 2 screen if it it the
best bid/ask currently posted on the ISLD book..all ISLD orders at the best bid and best ask are lumped together and
displayed on MB's level 2 screen next to the ISLD symbol
[10:15] <_ig_> Why did I get three consectuive "Trades pending" on three attempted trades?!!
[10:15] <BiLo> In other words, you cannot see all the buy/sell orders at various prices for a stock currently pending on
the ISLD book through MB's Level 2 screen..only the best bid and ask prices on the ISLD book are be displayed on
MB's L2 screen
[10:15] <BiLo> Some of you may know that the entire ISLD book can be and is displayed on some Level 2 screens...on
MB's system only the best bid and ask prices on ISLD are displayed
[10:16] <BiLo> Being an ECN, you can only place limit orders on ISLD..No market orders!
[10:16] <BiLo> No "All or None" orders are allowed either... therefore, you will get partial fills on ISLD
[10:16] <_ig_> I tried 3x to buy ICCA as the price was going up..."trade pending"..sheesh!!
[10:17] <BiLo> In order to avoid partial fills on ISLD, you must watch the size of the ISLD bid or ask on L2 to make
sure the size of the ISLD bid or ask that you are trying to hit is big enough to fill your order.
[10:17] <BiLo> If the size of the ISLD bid or ask you are trying to hit is smaller than your order, you will get a partial
fill... immediately!
[10:17] <BiLo> the rest of your order will remain live on the ISLD book, but even if there is a MM on the bid/ask at the
same price as you just got on ISLD, the rest of your order will not fill until an offsetting order is posted to the ISLD book
at your price. Numerous partial fills of the same order on ISLD are only charged one commission by MB.
[10:18] <BiLo> If you cancel the rest of your ISLD order after a partial fill and re-enter the remainder of your order thru
another route (ARCA,SOES,SN) to get to the MM's or other ECNs bid or ask, you will be charged another commission
by MB ....even if it fills at the same price as the partial fill you got thru ISLD!!
[10:19] <BiLo> The ISLD key is not like the ARCA key! The ARCA key goes thru various order routing systems for
you to try and fill your order..including preferencing MMs. MB charges only one commission for a single order thru
ARCA no matter how many partials it takes to fill the order and no matter how many order systems ARCA goes thru to
get it for you.
[10:20] <BiLo> The ISLD key merely posts your order on the ISLD book and when an offsetting order at your price
comes in it executes your order up to the size of the offsetting order. If the opposing order is big enough, your order will
be filled completely. if not you will get a partial fill and the balance will wait for another opposing order to come at your
price.
[10:21] <BiLo> The advantage of ISLD is that it is a large and very active ECN ...it provides significant liquidity for
trading many many stocks and when your order matches on ISLD the execution is IMMEDIATE! NO MMs are on the
other side taking their sweet time deciding whether to execute your order or not.
[10:22] <BiLo> The disadvantage is that you caqn only trade with other ISLD traders
[10:23] <harkmark> does ARCA also try to execute through ISLD?
[10:23] <SethD> Does ARCA user ISLD?
[10:23] <BICK> BICK = LDB
[10:23] <BiLo> Now for some of my opinions and observations on ISLD. These are my opinions only!! Then I will
open it up for questions.
[10:23] <BiLo> I believe that ISLD as an ECN is more liquid than the ARCA ECN (TNTO)..by that I mean that if you
have an order sitting at the bid or ask on ISLD verus that same order sitting on TNTO, the odds are that the ISLD order
will fill before the TNTO.
[10:24] <BiLo> Even if there is a pending TNTO order you want to hit the execution time is still slower than if you were
executing the same order on ISLD...again these are just my observations!
[10:25] <BiLo> I believe all of you will see the advantages of having direct access to ISLD
[10:25] <BiLo> once you use the ISLD key for a while
[10:25] <Beach_> Hello soloist
[10:26] <soloist> hello
[10:26] <BiLo> I for one am certainly glad MB is providing it on their trading platform
[10:26] <BiLo> Now for a few questions
[10:26] <Fred8> If using ARCA, can you preference and trade w/ ISLD?
[10:26] <BiLo> Yes Fred
[10:27] <SethD> Does ARCA use ISLD?
[10:27] <BiLo> Yes ARCA checks ISLD to try and fill your order
[10:27] <Duncan3> so... it seems to me like ARCA is slower, but more likely to fill eventually... whereas ISLD is fast,
but you may wait around on a large order...
[10:27] <harkmark> is there a large enough volume in ISLD book to virtually guarantee a match?
[10:27] <Fred8> So I dont see the benefit of ISLD, if you can hit ISND using ARCA
[10:27] <BiLo> Hark depends on the stock
[10:28] <harkmark> just have to try it I guess
[10:29] <BiLo> Fred..the ISLD key elinimates the extra step of preferencing when seconds count
[10:29] <zge> Fred, faster, only use it to instanltly take out existing ISLD bid or ask, otherwise ARCA to broadcast your
order
[10:29] <cknk> harkmark you have to look at the size
[10:29] <Fred8> OK. Thanks
[10:29] <befstk> most are refugees getting away from isld
[10:30] <harkmark> on lvl2 screen, if ISLD is not listed as best ask and I put in a best ask limit, will two ISLDs show
up?
[10:30] <GGomes> Was ISLD instituted to combat(in a way) the greedy MMs? (hope they don't see this!)
[10:30] <Fred8> Any extra charge to using ISLD?
[10:30] <harkmark> or will my order now shift ISLD to best ask?
<RHD_> 3fred, no xtra for ISLD
[10:31] <BiLo> hark your order as best bid/ask will show up on L2 as ISLD
[10:31] <sdo56> How come I don't have an ISLD choice? Does everyone else have ISLD on their button rmb popup?
[10:32] <cknk> sdo right click on a button and select isld
[10:32] <befstk> any effect on shorting ?
<RHD_> 3If you do not have an ISLD button, please call MBTrading 888-790-4800 or email us at
manhattan@atthemoney.com so we can verify.
[10:32] <BiLo> any other questions?
[10:32] <JBR> Could you also give a short overview as to what situations best fit the different avanues e.g. ARCA,
SOES etc? Is SELECTNET useful anytime over ARCA?
[10:33] <SethD> good question
[10:33] <Fred8> Can you short w/o an uptick on bid?
<RHD_> 3JBR I would like to do progressive talks in this channel each week about different routes.
<RHD_> 3Fred, you may offer out but you can not sell on a dt
[10:33] <SethD> Ross, we need another group chat on using all the keys
<RHD_> 3Seth, and we will have several
[10:34] <GaryB> is there a fast way to see if enough shares availible on isld and if not execute arca
[10:34] <Nancy0425> Can future chats please be after the market closes please :)
<RHD_> 3nancy, sure
[10:34] <BiLo> Gary look at the size on L2
<RHD_> 3I want to thank Bilow for an excellent discussion. I am sure we can all profit some by his instruction. Also
thanks to all MBTraders for helping to make this room such a great sucess.
[10:35] <BiLo> My pleasure Ross
[10:35] <SethD> Bilo, thanks
<RHD_> 3I think our next discussion will be on the merits of SOES, then we will do SN and finally ARCA to wrap it
all together
[10:36] <harkmark> thanx Bilo :-)
<RHD_> 3This log will be available on the website for MBTraders tonight.
[10:36] <BiLo> I will be around to answer any more questions
[10:36] <SethD> Ross, sounds like a great idea
[10:36] <soloist> got in late but, this is a great idea
[10:36] <Geren> See ya sportsfans
[10:36] <CMP> Bilo, very clear explainations, thanks
[10:37] <befstk> very helpful
[10:37] <JBR> RHD - Could I get a few q's answered on the BEACH Support Channel or here?
[10:37] <BiLo> U R Welcome
[10:37] <SethD> Bilo, is ISLD always displayed at best bid and ask even if its 1/2 point below or above other ecn
[10:37] <GaryB> Thanks very much Bilo:-)
<RHD_> 3JBR, thats what were here for
[10:37] <soloist> would be good to post log somewhere
[10:37] <BiLo> Seth no will show up down in the stack onm L2
[10:37] <harkmark> Bilo, upon hearing of sudden news gonna push a stock up quick, sounds like ISLD might be the
quickest way in?
<RHD_> 3sdo, you sound like you are having a bandwidth problem
<RHD_> 3For those of you using a Time and Sales
<RHD_> 3...
<RHD_> 3Set the time back to 1 min instead of 60
[10:38] <JBR> What about options with MBT? Can one get quotes for options? Quotes for Indexes?
<RHD_> 3this will greatly improve performance
[10:38] <SethD> yes, so if it's far off the best bid or ask than no reason to use ISLD right?
[10:38] <BiLo> hark-usually not a lot of ISLD sellers in that situation
<RHD_> 3JBR, design Turo Options in you menu itema
<RHD_> 3This log will be available on the website for MBTraders tonight.
[10:39] <harkmark> so perhaps best guarantee to use ARCA?
[10:39] <Barney2> ross, t&s works well with 1 min
[10:39] <soloist> great, thanks
[10:39] <BiLo> Thats right SETH
[10:39] <F1NH> italiano read the log dude
[10:40] <SethD> BILO what is the advantage of preferencing
<RHD_> 3I will email everyone the hyperlink to the log this evening
[10:40] <birddog> Why does archip seem to get traded around so much?
[10:40] <BiLo> hark usually best to perference an MM thru SN IMO
[10:40] <Barney2> thanks ross!
[10:45] <BiLo> Seth...ARCA works the order for you..in slower moving trades that can be a real advantage
<RHD_> 3The more tools you have the more chances you have to work an order.
[10:45] <GGomes> Seth ARCA will go thru the other ECNs as well ISLD does only ISLD
[10:46] <SethD> I know, just difficult to figure exactly what each tool does. That's why I look forward to chats on buy
buttons
[10:46] <BiLo> Plus it will save you the commissions you will encur if you go thru several different routs to get filled
yourself
[10:46] <GaryB> we need to know the different situations and whats the best one to use for each. Thanks:-)
<RHD_> 3Seth, that is where as your experience grows you will learn, it will just take some time
[10:47] <harkmark> if you preference a MM with SN can other MMs see order and pick it up?
<RHD_> 3Gary, we will have weekly seminars where I will present various ideas on order routing
[10:47] <BiLo> No Hark
[10:47] <GaryB> RHD-- Thanks
[10:48] <SethD> Ross, and Bilow, thanks, back to this beast of a market
[10:51] <Duncan3> an ISLD only allows limit orders... seems like a quick desicion is needed...
[10:52] <birddog> RHD why would he post the bid/ask if he didn't want to trade?
<RHD_> 3wants to see if there are buyers before he moves
one chat a week next week SOES
funk |
