Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

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

To: LPS5 who wrote (7061)	4/27/1999 2:54:00 PM
From: Dan Duchardt	Read Replies (2) \| Respond to of 12617

I went off and did some quick (not at all thorough) reading related to OATS. Doesn't sound like what we might hope for. One Q&A entry says T6. Will I need to report the execution if it occurred via a Nasdaq execution system, such as SOESSM (Small Order Execution SystemSM) or SelectNetSM? No, you would not need to report the execution; you would only need to report the New Order and the Route to the Nasdaq execution system. (Last updated 05/01/98) In the broader context of OATS, the reply makes sense. It seems to me the system is intended to track the handling of orders from clients from the time they are received until they are entered into a system to handle the trade, or manually executed. What goes on inside of SOES or SelectNet is separate. I see nothing about tracking market maker movement, and relating that to orders received via SelectNet. Furthermore, OATS is not intended to be a real time system. There is no "immediate" reporting requirement, and only a relatively (and understandably) fuzzy definition of what constitutes an order being received by non-automated means (telephone, etc). I still think the only way to "document" backing away from SelectNet orders would be to look to time and sales in instances where the MM changing his quote causes the inside market to change, and showing from somewhere that you had sent a preference order prior to that quote change. If NASD does not keep an automated log of all orders submitted and MM movement then your order records would have to be time synchronized with time and sales records. At the level of 1 or 2 seconds, synchronization would be impossible to prove. And, unless NASD keeps a log of all MM movement, you could never prove which MM backed away. It's nice to hear that NASD is responsive to complaints they receive, and I don't doubt that they would take appropriate action if they were getting multiple complaints, but I doubt they keep the detailed log that is needed to prove wrongdoing in individual cases. If someone knows otherwise, I'd be happy to hear about it.