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

To: LEVEL7 who wrote (3396)	7/20/1998 7:30:00 AM
From: steve goldman	Read Replies (2) \| Respond to of 4969

Level7, a few things to further clarify: a. MMs do have books of what THEIR particular orders look like at various prices...similar to an ECN...you combine each firms best bid/offer and you get a Level2. It wouldnt be technically called a book so as to mistake it with the single specialists book, but the idea is the same. The NASDAQ book for abcd company is the Level2 screen, the picture of bids and asks up and down. b. Agreed that any brokerage firm is not obligated. but ifyou give it to Etrade, they cant protect you (nor can anyone for that matter) if they dont get it to a mm. From my desk, I can hold a stop here on my desk or give it to a market maker, if the market maker agrees to do 2k when it hits that level. c. The $10 bid versus print. On listed stocks, its the print, again because a single person, the specialist, is primarily responsible for the dynamics of the stock and you can HOLD THAT person responsible. Since there is no formal "stop' order on a nasdaq stock, virtually all the firms I know do it via. the bid. Given the 90sec. time frame mm have to print to the tape, for my own stocks, I 'd go off the bid, not the prints, which is exactly how we work client orders. Since there are no 'exchange' promulgated rules on how Stops work on the nasdaq, be sure to speak to your broker. We work off the bids. You could go back and forth over which is better, bids or prints. On nyse since most prints go immediatley to the tape, thats the best, but on the NASDAQ since xyz firm could get hit with stock, start adjusting their quote, be on the bid when they are infact not exposed, and slap up their prints when its 1/4 lower, well, my reco is use the bid. Regards, Steve@yamner.com