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Strategies & Market Trends : DAYTRADING Fundamentals -- Ignore unavailable to you. Want to Upgrade?

To: - who wrote (4585)	10/4/1999 9:11:00 PM
From: Dan Duchardt	Read Replies (1) \| Respond to of 18137

To: All Re: ISLD executions Steve's post, and another one I recall reading (later in sequence I think, from Matt) refer to partial ISLD executions resulting in remainder order cancellation, something that others say should not happen. I wonder if anyone has definitive word on this issue. I will post what I believe to be true, and ask others to respond if they know differently. You can send orders to ISLD via SelectNet Preference (or some automated tool {e.g. Cyber, ARCA??} that uses Selectnet Preference). If you do this, and there are not sufficient shares on the ISLD book, ISLD will fill what it can at your price or better and then cancel the remainder of your order, leaving you with a partial fill. You can send a limit order directly to ISLD. ISLD will attempt to match your order with others already on the book, and immediately execute whatever matches or improves your price. The remainder of your order goes on the book. Some brokers will pass your order to ISLD regardless of your price; ISLD will reject the order if it locks or crosses the market. Some brokers allow you to send a "client only" order (maybe not the right terminology) that will never be presented to the broader market, and hence will avoid the cross/lock rejection problem. Your order will be filled by any and all existing or incoming matching orders. This is the delightful "get me in/out NOW" order. BUT, there are still some systems out there that don't wait for ISLD to keep its own book clean and flatly reject any limit order that, if posted, would cross or lock the market, even though ISLD would reject such an order if it were received. There was a time when if your order was at the top of the book, and ISLD received a matching but smaller order, you would get a partial fill and lose your position in the queue, rotating to the bottom of the price level. Early in 1998, ISLD changed it's interface to prevent this loss of queue position on partial fills, but it was never clear to me that ALL orders received this treatment. It seemed from what I heard that it depended on options selected by the broker when the order was placed, so this might vary from one trading platform to another. Dan