Terminology explanation

[Teezy]

Hi guys, I know this is a very noobish question but hey that's what I am looking into this.

When someone says 3 bid at 5 or something along those lines could you explain where the numbers come from?
I understand on something like the Bund the bid is at 140.91 with 246 contracts in the queue and the ask is at 140.92 with 340 in the queue etc.

(Image of a ladder with the explanation of x bid at y would be most helpful too)

Much appreciated!

 

[timsk]

(Image of a ladder with the explanation of x bid at y would be most helpful too)

Hi Teezy,
I think you've pretty much answered your own question. Without seeing the context of your quote I can't say for sure but, as you say, it almost certainly refers to the number of contracts at the inside bid (or ask).

Here's a good article by a T2W member called DionysusToast in which he discusses the DoM ladder and offers insights into the relationship between buyers and sellers: Understanding Liquidity and Market Pullbacks by Peter Davies.

If you want to see someone trading a DoM ladder, there are any number of videos on YouTube.
Enjoy!
Tim.

PS. If you want to try out a DoM ladder for yourself, open a demo account with a futures broker. Check out the Broker Reviews section of T2W to get an idea of who is who. I've used Infinity Futures in the past and their DoM ladder is simple to understand and use - and I recommend them highly. NinjaTrader offer one that is very popular and used by many traders and, I think I'm right in saying, is the one featured in Peter's article.

 

[Teezy]

Hi Teezy,
I think you've pretty much answered your own question. Without seeing the context of your quote I can't say for sure but, as you say, it almost certainly refers to the number of contracts at the inside bid (or ask).

Here's a good article by a T2W member called DionysusToast in which he discusses the DoM ladder and offers insights into the relationship between buyers and sellers: Understanding Liquidity and Market Pullbacks by Peter Davies.

If you want to see someone trading a DoM ladder, there are any number of videos on YouTube.
Enjoy!
Tim.

PS. If you want to try out a DoM ladder for yourself, open a demo account with a futures broker. Check out the Broker Reviews section of T2W to get an idea of who is who. I've used Infinity Futures in the past and their DoM ladder is simple to understand and use - and I recommend them highly. NinjaTrader offer one that is very popular and used by many traders and, I think I'm right in saying, is the one featured in Peter's article.

I have a DOM ladder open in front of me.
I have attached an example, in it could you tell me which x bid at y would be?
As I've heard people around me speaking about 3 bid at 5 when the price is 140.66 437 in the queue etc. but have no idea where the 3 and 5 came from

 

[Solas0077]

I think 3 is the last digit of the bid and 5 the last digit of the ask.

 

[Teezy]

I think 3 is the last digit of the bid and 5 the last digit of the ask.

How would that relate to the pic I have attached?

 

[timsk]

. . . As I've heard people around me speaking about 3 bid at 5 when the price is 140.66 437 in the queue etc. but have no idea where the 3 and 5 came from

Hi Teezy,
If this comment was made in relation to this instrument at the time of your screenshot - then I have no idea what it refers to, sorry. I don't trade using DoM ladders, Level II or time and sales data - so it's not an area I'm especially familiar with. Hopefully, another member who is totally au fait with all this stuff will be able to provide a more helpful answer!
Tim.

PS. Can you not ask the people you're referring to who have made the comment - or are you listening to a squawk box or something?

 

[Teezy]

Hi Teezy,
If this comment was made in relation to this instrument at the time of your screenshot - then I have no idea what it refers to, sorry. I don't trade using DoM ladders, Level II or time and sales data - so it's not an area I'm especially familiar with. Hopefully, another member who is totally au fait with all this stuff will be able to provide a more helpful answer!
Tim.

PS. Can you not ask the people you're referring to who have made the comment - or are you listening to a squawk box or something?

That comment wasn't made at that exact time of the screenshot, it was more of an example but I've heard it said when I couldn't find anything to match up with the DOM.

For the screenshot above, does anyone know what x bid at y would be?

 

[Teezy]

Just found this: http://www.investopedia.com/terms/b/bidsize.asp

I think this may explain it

 

[timsk]

I think this may explain it

That relates to shares rather than contracts Teezy. The shorthand might be the same, then again, it might not! So, in your screenshot, you've got 195 (x) bid @ 140.73 . My guess is that Euro Bund futures traders would only use the post decimal number and shorten this to 195 bid @ 73 - but I may be wrong.
Tim.

PS. Teezy - my memory of the DoM ladder is gradually returning the more I think about this! I'm not familiar with the particular DoM in your screenshot, but I think that the green box highlights the most recent executed trades. So, I suspect your original question about what you heard relates to trades that have taken place - as opposed to those in the queue. A case of not seeing the wood for the trees! So, your screenshot would be expressed as 1 offered @ 74.

In your original example of 3 bid at 5 - this then means that 3 contracts went through on the bid at XXX.05. Anyone trading the instrument would know that XXX was 140 in the case of the Euro Bund contract - so there would be no need to mention it. As I say, it would be good if someone more familiar with this stuff could confirm (or contradict!) what I've said - but I think it's correct.
Tim.

 

[Teezy]

That relates to shares rather than contracts Teezy. The shorthand might be the same, then again, it might not! So, in your screenshot, you've got 195 (x) bid @ 140.73 . My guess is that Euro Bund futures traders would only use the post decimal number and shorten this to 195 bid @ 73 - but I may be wrong.
Tim.

PS. Teezy - my memory of the DoM ladder is gradually returning the more I think about this! I'm not familiar with the particular DoM in your screenshot, but I think that the green box highlights the most recent executed trades. So, I suspect your original question about what you heard relates to trades that have taken place - as opposed to those in the queue. A case of not seeing the wood for the trees! So, your screenshot would be expressed as 1 offered @ 74.

In your original example of 3 bid at 5 - this then means that 3 contracts went through on the bid at XXX.05. Anyone trading the instrument would know that XXX was 140 in the case of the Euro Bund contract - so there would be no need to mention it. As I say, it would be good if someone more familiar with this stuff could confirm (or contradict!) what I've said - but I think it's correct.
Tim.

Thanks for the explanation Tim.
I await any other replies with appreciation.