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Non-Tech : MB TRADING -- Ignore unavailable to you. Want to Upgrade?

To: wily who wrote (3823)	2/11/1999 7:20:00 PM
From: Rick Faurot	Read Replies (1) \| Respond to of 7382

<<So, if the box is unchecked -- you are not preferencing MM's? You are accessing ECN's direct? I thought the only ECN you could access direct was ISLD. >> If the PNP box is unchecked, you are using the "normal" ARCA program which does preference MMs after first hitting available ECNs. ARCA hits every available ECN and that is why it is a great tool. However, if you check the PNP box, ARCA only crosses the ARCA book (this is my understanding) just as ISLD only crosses the ISLD book or else displays. In other words, if you check the PNP box, think of ARCA as exactly like ISLD. PNP means "post, no preference" BTW. The only advantage I can see of using PNP is that you skip the second phase of the normal ARCA program, ie, preferencing MMs. If you use PNP, you either cross an ARCA order, or you display. But remember that you are now subject to the same cross/lock rules as ISLD. So you can get killed orders, partial fills and then kills, etc. Using normal ARCA (no PNP checked) is superior IMO because it lets you bid above the ask and fill down to the lowest price, like ISLD, but it won't cross/lock kill and you won't get killed after a partial. With normal ARCA your order is live till it fills or until you cancel. If you think you are hanging too long preferencing an MM, cancel and try something else. Usually, if you can't fill on ARCA, your only shot is if a panicky ISLD seller drops back onto the inside and you hit him fast--often a good ploy, BTW. The disadvantage (at times) of ARCA is that if you display, you tend to push the market. If you are chasing and you display as an overbid, the sellers tend to flee and you don't fill. Tough luck. The trick is to go for your shares a little early--and then pray it doesn't reverse on you!! RickF