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Strategies & Market Trends : From the Trading Desk -- Ignore unavailable to you. Want to Upgrade?

To: Robert Graham who wrote (2237)	1/8/1998 12:57:00 PM
From: steve goldman	Respond to of 4969

For a large piece of stock, you have to find the large buyer. YOu have to get an idea of who is acquiring and willing to take on large pieces. Sometimes, you can work a smaller order of 20 to 50k shares, depending on the stock. (ie. you do it 2k or 3k ata time). There is no exact science to it. If the client wants to move a piece of 30,000 GE, we could try working it in pieces, all in one day, over a number of days, move the whole piece at once if the bid is there, etc. Most clients of ours come to rely on our opinion of what is the "best" way to effectivelymove a piece given current market conditions. We probably handle several large pieces each day, and to be honest, there is no exact script we follow: It depends on the customer, the stockthe marketplace, the other market makers, and the trader. Markets: 1st market - Exchange listed, NYSE, AMEX 2nd Market - OTC nasdaq, govt bonds, etc 3rd Market - Exchange listing done off the floor (this is where online firms and many other firms route listed order away from the floor to save floor broekrage) 4th Market - Instinet, I believe the other ecns fall here. Mostfirms route orders away from the primary exchange, for listed stocks this would be the nyse or amex and go to a third market maker. He makes market in stocks, just like an market maker would make it in DELL or MSFT. This saves the firm the brokerage expense (the specialisty might charge upto 1 1/2 or 2 cents per shares). The downside is that the client might have gotten a bettter price on the nyse since the third market makers is trading against the order. If they get an 1/8, you might have gotten the 1/8. Regards steve@yamner.com