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If your broker has access to a globex terminal, and more importantly is
sitting there staring at the screen so he can see price approach your
stop, then he can quickly enter your order and get very close to your
price. The fills on the e-mini are almost instantaneous and are quite good.
The problem with what people are being told about market orders and stops
being taken by some of these firms is that the customer has no idea exactly
what protocols the firm with whom they are talking has established to
accept these types of orders.
The absolute best situation possible, as described above, is in all
probability not the way it is going to work. It would be very expensive for
every broker at a desk to have a globex terminal sitting in front of them.
More likely, there is one terminal on the desk handling all types of orders
and one person is in charge of entering them.
But, I still don't see how one person, even if they did have a terminal in
front of them, could possibly effectively work stop or limit orders for
more than two or three people at a time at the most. I would never be
comfortable with that arrangement. It is a recipe for eventual disaster as
volatile as the markets have become, and are likely to stay.
Tom Alexander
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> From: Eric <eric3@xxxxxxxxxxx>
> To: RealTraders Discussion Group <realtraders@xxxxxxxxxxxxxx>
> Subject: Re: Globex EMini
> Date: Sunday, November 09, 1997 8:17 PM
>
> Peter2150@xxxxxxx wrote:
> >
> > In a message dated 97-11-09 00:40:03 EST, eric3@xxxxxxxxxxx writes:
> >
> > > Hate to say it, and even though you think it doesn't make sense, this
is
> > > all correct. The broker is kind of telling half a story, but the
rest
> > > is true. There are no stops and no market orders allowed on Globex.
> > > Some brokers are accepting stops (which is a market order in the
end)
> > > that they watch themselves and brokers are saying they take market
> > > orders, but they are not true market orders.
> > > Market orders on Globex are really 4 tick (1 point) limit orders so
yes,
> > > you can be unable on an order you place as a "market" order. Not
even
> > > all brokers are fully aware of this but if you are trading in these
> > > volatile times, you should be aware of it.
> > > This is one of the current limitations of electronic trading. It is
> > > there as a protection for the customer so you don't pay way up
> > > unintentionally when the market is thin.
> > >
> >
> > Okay Eric. I think I understand what you are saying. Let me ask you a
> > question. I am long 1 contract and I tell the broker to sell 1 at say
915
> > stop. It goes thru and thus has to become a limit order. Say price is
now
> > 914.00. Exactly what would the order be. Buy one at 913 or better.
In
> > another words what price does the broker now use for that limit.
> >
> > Pete
>
> Best to ask your broker since I don't know the exact logistics of the
> order entry but here is my guess.
> First, the stop order is not entered into the terminal. Some clerk is
> watching the screen for your stop price to trade before he can enter
> it. When he sees 915 trade, he enters a sell limit order at 914 (4
> ticks lower than your price). If there is a bid higher than 914 on the
> screen, you are filled at that price. If not, then you are unable and
> the order stays in the system as a sell at 914 and you hope the market
> comes back up.
> Crazy but true. Get a good explanation from your broker because there
> is possibly leeway in how they handle these things.
>
> Eric
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