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To: Eric P who wrote (6835)	3/26/1999 10:17:00 AM
From: neelu	Read Replies (1) \| Respond to of 12617

Buy cmgi now at 182 and make 4 or 5 points today or monday then sell

To: Eric P who wrote (6835)	3/26/1999 5:43:00 PM
From: Tai Jin	Read Replies (1) \| Respond to of 12617

I've been able to take out an outside market offer on ISLD from MBTrading. ...tai

To: Eric P who wrote (6835)	3/26/1999 8:14:00 PM
From: just bearly	Respond to of 12617

Eric P, Thank you for taking the time to explain the different island order types/options. This is an issue that has concerned me lately, and I was very glad to finally have it explained clearly and completely. I have noticed on certain fast moving stocks and on IPO's specifically that I cannot use island because there are others placing higher bids(most often) or lower offers. I am glad to see that this may be resolved shortly, since I feel it does put me at a disadvantage at times. Of course, I really like the sound of the hidden option. Very sneaky. :-) Thanks, Tara

To: Eric P who wrote (6835)	3/27/1999 12:02:00 AM
From: JDTrader	Read Replies (1) \| Respond to of 12617

Dear Eric: I wrote a lengthy response to your comments, but before publishing it I clicked on my "back" button to find out who had already responded to you and now my response is lost and I cannot find it. Therefore, here is my short version of it. I appreciate your informative comments about various types of Island orders. I would certainly ask my broker about hidden orders, which I think are priceless in certain situations. However, I think you are missing the point and the very idea behind being able to execute an Island order in the manner that I described in my previous comment, and which you have cut and paste in your response. The GOAL is to exit your position in the FAST MARKET that is going against you. That is why traders pay the premium price, otherwise they would have gone for the inside bid and ask. In fact, if you are getting posted, you have not accomplished our goal in that your order did not get executed. In other words, you will never lock the Island book because your order wont get posted and is executed as if it were a combination of inseparable market orders at different prices. The only trace of what you did for other traders who are still sitting on their loosing positions is the print of your executed order in the book; that is when they wonder why their orders did not get filled--I have been there. The Nasdaq rule pertaining to locking the market does not extend to the Island book and only covers the level II window. One of the primary objective of the Island book is to allow traders to participate in an auction-like atmosphere and not to police the profitability of their trades. Contrary to what you stated, almost every dayrading broker except cybertrader allows you to EXECUTE island orders above or below the inside prices. I think Tai has posted a response to that effect as well. At any rate, the order may be called subscription only or even hidden, but the key is that it will allow the trader to sweep the posted orders before anyone else, or those who are trying to chase the market. From what I have been told by the floor traders for various brokerage houses, this execution strategy is called "sweeping the street" or "picking the cherries". The island book starts from the top of the list (inside bid or ask) and sweeps down the posted offers, so that you still get the best available prices in the Island book and stops only at your posted price or when you are filled. Your chances of getting filled, which is your primary objective in our scenario is substantially higher. In fact, some of the SLK's trader I have known and went to undergrad school with say that this is the only way you will get out of your position if you are caught in one of the situations that we have discussed before. I was not able to figure out why some called it picking the cherries but I think it is perhaps because you get the best of what is available before everyone else. Ask your broker whether the Ecn entry or execution system they offer is proactive? That is what REDI book-based brokers provide, which enables you to sweep the street if you are ever caught off guard. I will find out if this in fact is called subscription only order, and whether their program automatically treats the order as subscription only, allowing you to sweep the street, when posting your order would otherwise lock the Island book. take care,

To: Eric P who wrote (6835)	3/27/1999 6:51:00 AM
From: Eric P	Read Replies (1) \| Respond to of 12617

Just as an addition to the ISLD discussion, the following was posted in another thread several months ago and may be useful for new traders: If you place an ISLD order, four things can happen: 1) Complete fill: If any existing limit orders are posted on ISLD that are within your price limits, you will be filled by these posted orders. Example: DELL is trading at 62 bid by 62 1/16 ask on Nasdaq. You place an ISLD order to buy 2000 DELL at 62 1/4. The ISLD order book has 300 offered at 62 1/16, 500 offered at 62 3/32, 3000 offered at 62 1/8, and 2000 offered at 62 1/4. Your entire order will be filled as follows: 300 at 62 1/16, 500 at 62 3/32 and the remaining 1200 at 62 1/8. 2) Partial fill: Assume the same information from the above example, except you order 2000 shares at 62 3/32. Now, your order will be partially filled as follows: 300 at 62 1/16, and 500 at 62 3/32. Your remaining 1200 shares cannot be filled because there are no opposing matching orders. Also, the remaining orders cannot be posted on Nasdaq, since it would cross the market (i.e. you would be attempting to place a bid above the inside offer price; Note: a locked market would also not be allowed, which would be attempted to post on Nasdaq a bid price which equals the inside ask price). 3) No Fill: If there are no existing ISLD orders on the book that matches with your order, and your order cannot be posted on Nasdaq because it will lock or cross the market, then your order will automatically be cancelled and returned to you. Example: DELL is trading at 62 bid by 62 1/16 ask on Nasdaq. You place an ISLD order to buy 2000 DELL at 62 1/16. The ISLD order book has 500 offered at 62 3/32, 3000 offered at 62 1/8, and 2000 offered at 62 1/4. There are no existing ISLD offers at or below your bid. Therefore, you currently cannot be filled from ISLD. If posted on Nasdaq, your order would lock the market in DELL at 62 1/16 bid and 62 1/16 offered. Therefore, the ISLD system will not allow you to do that and your order will be returned unfilled. For more information, see Chapter 2 of the Nasdaq Traders Manual dealing with "Locked or Crossed Market Conditions": nasdaqtrader.com 4) Order posed on ISLD: If your bid order is lower than the inside offer, your order will be posted on the ISLD book and the best bid/offer price on the ISLD book will be posted on Nasdaq. -Eric