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Non-Tech : Market Makers - What They Do and How They Do It
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To: DanZ who wrote (179)2/25/1999 11:49:00 PM
From: KFE  Read Replies (1) of 429
 
Dan,

<<<Your broker really doesn't have much to do with executions other than the speed with which they send your order to the person who will ultimately make the trade. If you use limit orders, then the only way you can get a poor execution is if the broker was too slow to forward the order and the stock moved beyond your limit price before you got filled.>>>

<<<If you feel like you got ripped off on a market order and the broker sent the order to the market within a reasonable amount of time, then the market maker is the one who you have to blame, not your broker.>>>

Couldn't disagree more. Executions from broker to broker can vary tremendously. Broker is definitely responsible for getting you the best execution. Almost all discount brokers sell order flow for OTC stocks and some such as Schwab forward OTC orders to a subsidiary (MASH).

Some will accept stop loss orders some will not and this is the firms responsibility not a market maker. If your trying to improve the inside spread does your order get reflected.

There are alternates to giving order to market maker such as ECN's and SOES which the broker can explore.

I didn't mean to imply that on OTC and option orders you should blame your broker. Blame yourself, you should not place them unless you have to get in or out of a stock at any price.

Ken

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