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

To: Apakhabar who wrote (10911)	12/14/2000 9:39:34 AM
From: LPS5	Read Replies (2) \| Respond to of 18137

Transparency, generally, is great for everyone, except when it comes to executing orders. To see all the quotes, size, prints, participants, provides value to traders and investors large and small alike. But, when it comes time to execute, for institutional market participants, market transparency can sound the death knell for getting decent, let alone good, executions. When Instinet was created in 1969, the whole concept was to reduce market impact and adverse execution effects by removing transparency both through the use of a closed, restricted access institutional limit order book and, through the fourth market concept, not permitting broker-dealers and other sell side entities visual or trading access. Buysiders would trade directly with one another, avoiding the information leakage that sometimes comes with intermediary involvement. But, when the concept of hidden markets came up a few years ago, the long-accepted practice was called into question. Nonetheless, IMHO, a fair balance was struck. While entirely at the discretion of the ECN and ATS entity as to how, or to whom, to display their book, their inside market must be displayed in the Level II montage. I think that market participants, from miniscule to leviathan, should have the option of concealing their order size from the market in terms of visibility; as for the actual trading of orders, I am a strong advocate of restricting, on the basis of a certain percentage of the average daily volume, the amount of trading which can be conducted outside the normal market venues in crossing systems and the like. LPS5

To: Apakhabar who wrote (10911)	12/14/2000 4:34:49 PM
From: TraderAlan	Read Replies (5) \| Respond to of 18137

Ap, <My thought is that obfuscation is good for traders, second in importance only to volatility> I'll go look up o-b-f-u-s-c-a-t-i-o-n in the dictionary <g> but I want to go out on a limb here and say that its a misconception that volatility is good for traders. There is plenty of "that" and liquidity to go around. I'm not all that sure that most participants are smart enough to overcome the lack of directionality in volatility, ie they are wrong as often as they are right about the next swing. Much more important is "predictability", ie having something in the landscape that allows inefficiency to translate into opportunity. No offense but the scalper gets far too much attention and credit in the day trading movement. Many folks prefer to avoid that psycho environment and play the numbers in a less stressful manner. Alan