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Strategies & Market Trends : The Final Frontier - Online Remote Trading -- Ignore unavailable to you. Want to Upgrade?

To: TFF who wrote (995)	11/16/1997 5:54:00 PM
From: steve goldman	Respond to of 12617

Market Orders - As a day trader, ifyou are with the right firm, you should consider using a market order for all listed stocks and some OTC stocks (although we all know the OTC market maker/routingorder game) or at very least a limit order superior to the market by an 1/8 or 3/16. This probably holds true more for the closing transaction that an entry. If you miss it well, there's always something else to trade. I can tell you from first hand experience that I have gotten cute for an 1/8 or 1/16 and have gotten hammered for such penny wise pound foolish action. About 6 months ago, I was trading 2000 shares of SEG at about 50 or so. Wasn't acting well, down 1/2 for the day, I was down 1/8 or so. Went in with a limit and never got it, stock just sank from there. By the time I got an out from the specialist and then reevaluated it, the stock had fallen another 3/4. Put it in at the market second time around. The point is..you see some action that causes you to react...don't get cute for an 1/8 or so. If its good for the 1/8 its good for more. If not, you only lost an 1/8more. The max more you could improve is the difference between the execution price and the limit price. now on otc stocks, where these firms scoot out of the way and run a stock with no exposure and additionally you have to deal with your firm that might make markets, act as principal or route orders,which is what most of these online firms do, you now have a problem. Take a look at some of the firms that dont act as this but act as agency only and work orders and dont nondiscrimintorily route orders. So, I guess I would say, for listed stocks (where youknow you get put onto the amex and nyse, not routed to a third market), use a market order. For oTC stocks, evaluate each execution, scenario in its own light. If you own it and want out, use the market order. If its there, you get it, if it moves lower you get. Sure you run the risk they jerk the stockdown and then back up, butyou know you will be out. How do you know they don't totally kill the thing much,much lower. Just some advice from someone who does it for a living.No easy answer, but I personally feel much better with market orders unless. I would not feel this way if the firm to which I did the trade with market markets, acted as principal or simply routed everything. regards, steve@yamner.com