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Non-Tech : Interactive Brokers / Timberhill -- Ignore unavailable to you. Want to Upgrade?

To: Dan Duchardt who wrote (840)	12/7/2000 10:13:16 PM
From: rocklobster	Read Replies (2) \| Respond to of 9012

Dan, I have a question regarding limit orders... I have always used best execution, because I don't know enough about other routing methods, and it seemed like an unecessary hassle if best execution really was...."best execution".. however.. it occured to me that if best execution is simply landing my order in a market makers lap.. then he wont fill me til he has an ask at my bid.. So he can make the spread.. If I route directly to an ECN like island.. isnt my order just electronically represented in the open market.. and wouldnt this lead to a higher likelyhood of a quicker and better fill on limit orders.. It seems like in this case, that best execution actually guarantees that you won't get "best execution" am I correct in my thinking here? rok

To: Dan Duchardt who wrote (840)	12/8/2000 7:30:21 AM
From: Jeff Jordan	Respond to of 9012

I keep my Dreyfus account open for options however I'm sure I could probably do better w/ IB, cheaper to. all I have now is a futures account. I guess it's easy enough to add options as well. I have often noticed slow or no fills on my orders, I would probably get an immediate benefit.

To: Dan Duchardt who wrote (840)	12/8/2000 11:38:37 PM
From: Dan Duchardt	Read Replies (1) \| Respond to of 9012

A note from IB: In response to the recent discussion regarding option order routing, I received an email from an IB representative clarifying their position. Dan, Thank you very much for sharing your observation w/ us. The anomaly you mention can be explained as follows. When BE makes the decision as to where to route an order it "looks" at the market data of all the exchanges listing that option where the "AUTOEX SYSTEM" is turned on. If the market data we receive from OPRA (Option Price Reporting Authority) does not have the "autoex eligible" flag turned on, we disqualify that exchange. We do so because if the autoex is off, the specialist handles the orders manually - in the past we have had difficulty canceling orders handled manually. In other words, we do this in the effort to provide truly Best Execution. In the case you mentioned, we verified that AMEX did not have the AutoEx flag turned on. IB is contacting the Specialist at AMEX in hope to understand what went on. Also, on the Website we will include the language explaining the treatment of Auto-Ex flag. Hopefully we will see the day when firm pricing and automatic executions against published quotes are mandatory on all the options exchanges. Dan