Go Back   Trade2Win Forums > Styles & Strategies > Spreads Trading
Order Execution in spread trading Order Execution in spread trading
Site Guidelines | New Posts | Register Mark Forums Read

Order Execution in spread trading

This is a discussion on Order Execution in spread trading within the Spreads Trading forums, part of the Styles & Strategies category; I am a newbie in spread trading. I have some silly questions that I hope people can answer me. Thanks! ...

Reply
Sponsored By Capital Spreads Share thread with:  Submit to Digg Submit to Facebook
 
LinkBack Thread Tools
Old Dec 31, 2006, 12:28pm   #1
Rookie
 
quickg's Avatar
 
Join Date: Sep 2003
Posts: 23
quickg's Trading Profile
Order Execution in spread trading
I am a newbie in spread trading. I have some silly questions that I hope people can answer me. Thanks!

When you start a spread(TED, NOB etc), would you buy at the bid or at the ask? Sell at the ask or at the bid?

Or would you use market order?

If using limit order, would you miss one of the trade? If you can enter one but miss one side of the spread and the market starts to move quickly,what would you do?
quickg is offline   Reply With Quote
Old Jan 6, 2007, 10:59am   #2
ERA
Senior Member
 
ERA's Avatar
 
Join Date: Nov 2004
Location: Reigate
Posts: 101
Re: Order Execution in spread trading
quickg,

With the spreads you are suggesting I would go with market orders, with treasuries and ED's there is plenty of liquidity to get both sides done at a fair price. For other spreads look to enter at a quiet period in the market, I have found going with the last trade price addequate to get both sides filled. The main thing is not to try to get cute.

era
__________________
Keep your stops on the pavement.
ERA is offline   Reply With Quote
Old Jan 15, 2007, 6:13pm   #3
Senior Member
 
-oo0(GoldTrader)'s Avatar
 
Join Date: Mar 2005
Location: Hawaii
Posts: 328
-oo0(GoldTrader)'s Trading Profile
Done at the same time

The key word is simultaneous. Try making your trades simultaneous market on close (MOC).
Quote:
Originally Posted by quickg
When you start a spread(TED, NOB etc), would you buy at the bid or at the ask? Sell at the ask or at the bid?

Or would you use market order?
Market orders, you need simultaneous market orders to place a spread.
Quote:
If using limit order, would you miss one of the trade?
With any limit order you risk the possibility of missing the trade all together.
Quote:
If you can enter one but miss one side
When you put on one leg. Even for a moment, you do not have a spread or its protection. Trades must be done as near as possible at the same time!



Quote:
Originally Posted by ERA
with treasuries and ED's there is plenty of liquidity to get both sides done at a fair price.
What Era says here is right on. If you have excessive liquidity you can go at any time, like in interest rate vehicles. But for must trades you only get that sort of liquidity on the close. So usually we go with “Market on close,” trading spreads.

Quote:
For other spreads look to enter at a quiet period in the market, I have found going with the last trade price adequate to get both sides filled.
He must be using limit orders here. Other wise this is a good way to get your head handed to you.
-oo0(GoldTrader) is offline   Reply With Quote
Reply


Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
 
Thread Tools


Similar Threads
Thread Thread Starter Forum Replies Last Post
TS order execution speed John Devine TradeStation 2 Jun 30, 2006 1:11pm
Automated Order Execution--Need help!! xtick123 Mechanical & Systems Trading 9 Dec 15, 2004 7:08am
Order execution software Martin1973 Trading Software 8 May 13, 2004 2:58pm
IB - Order Execution Time alanb41252 Brokerages 46 Dec 20, 2003 4:32am


New To Site? Need Help?


All times are GMT -4. The time now is 10:57pm.


Copyright © 2001-2010 Trade2Win.

Pending NFA Registration (Member ID 0402027). Please be aware that off-exchange retail foreign currency (forex) trading involves significant risk of loss and is not suitable for all investors. Increasing leverage increases risk. Before deciding to trade forex, you should carefully consider your financial goals, level of experience and risk appetite. Any opinions, news, research, analysis, prices or other information contained does not constitute investment advice.