Liren,
In my previous reply, I didn't have the time to explain what I'm sure happened to your 2 orders. The explanation is quite simple.
>1) I had a order to buy 2000 shares of a very active NASDAQ
at market. The 1st 1000 shares was filled 2 minutes later.
The rest 1000 shares was filled 7 minutes later. The price
difference between 2 filled lots is $0.50. Even the spread
of stock was 1/8.
Explanation: You put in a market order for a NASDAQ stock that has what they call an "sm 10" (size minimum 1000). NASDAQ stocks are either sm10, sm5, or sm2 depending on their liquidity (avg. volume). Schwab only guarantees you 1000 shares for an "sm10" stock at the current "ask" price. They can theoretically give you any price they want for the other 1000 shares. You can bet you'll get screwed for them. In fact, you probably got at least 1/8 worst than you should have for the first 1000 shares. Never put in a market order for a Nasdaq stock if the number of shares is greater than the "sm" designated for that stock, unless your damn sure it's going much, much higher. Oh, and if you happen to get filled on all 2000 shares at the "current" ask on a market order, I would bet you everything I had the next move for that stock is down.
>2) I had a order to buy 1000 shares of a very active NASDAQ
at market. Schwab filled 500 shares 1 minutes later and
filled the rest 500 shares 3 minutes later. The real time
quote showed at least 1000 share in ask side. The 2nd
500 shares got a higher price.
Explanation: Similar to 1 except this stock is an "sm5" stock. Just because you saw 1000 shares on the ask side does not mean it's a "sm10" stock. It was most likely an "sm5" stock but a particular market maker was guaranteeing 1000 shares at the ask. However, it probably wasn't MASH (Schwab's MM) or another MM that Schwab uses if MASH isn't the MM for that stock. Even if it was MASH displaying 1000 shares, they probably will give you only 500 at the "current" ask since it was a market order and they know they can give you a higher price on the second 500 shares. It's a gift for them. You really need NASDQAQ Level II to know the "sm" of a NASDAQ stock. Although, you can usually tell if you have quote service that give size for bid/ask. If you see 5 show up a lot for size, it's "sm5". If you see mostly 10s, then it's "sm10". Very few stocks are "sm2" (I think CYCH is though).
Note: All the info above about "sm" will eventually become meaningless as the New Limit Display rules become fully implemented. So far, 100 NASDAQ stocks are using the new rules. Another 50 is scheduled to be phased in on 2/24/97.
ams |
