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

To: MechanicalMethod who wrote (2638)	3/15/2002 11:09:05 AM
From: eriksonc	Read Replies (2) \| Respond to of 9012

[While trading QQQ using Best Execution it sometimes displays limit orders as transmitted to NYSE. In time if it's not executed then it's listed as an Island fill when it does execute. Supposedly, IB's interface reappraises the situation and switches to Island if indeed it's looking better there. I've noticed NYSE fills limit orders away from the market only when it turns out to be a bad entry rather than the hoped for price improvement. I want to stay away from NYSE and AMEX in the future. Under the destination category I don't see BEST ECN. How do I specify BEST ECN and is it preferable to Island?] There is no BEST_ECN for listed stocks or ETFs and so if you submit your order to BEST, there is a chance it gets routed to the NYSE or AMEX and at that point it is out of your control. Thus, some people just trade QQQs via one ECN. The liquidity on Island for the QQQs is large enough that the chosen ECN is usually Island. With the API, since you can only submit BEST orders, you are at the mercy of IB's routing algorithm. There is no way to prevent your order from getting routed to the NYSE or AMEX. A serious flaw in my opinion. If we can manually select an exchange to rout to, it seems like the API should support that. In fact, it did for one version of the standalone TWS. Now it does not. My theory on why they won't allow direct routing through their API is because if there is an option between one ECN and another ECN for a fill, they can pick the ECN that gives them the most profit (i.e., choose the ECN that charges the least amount of execution for a fill). However, since we can manually route orders directly to specific ECNs, this theory doesn't really make much sense. Maybe IB thinks that the type of orders that automated trading systems generate will not fit their probability/profit model of the percentage of orders that hit certain ECNs. Good luck, Carl