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sure there is, it's identical!!! i repeat, off floor day traders offer
the identical fundamental economic reason as the day trading pit
traders in that they both provide liquidty and maintain an orderly
market.
for example, the s&p500 on May 12, during the rubin panic (or 10
minutes from "stop run" hell :)), it was all offers, no bids, until a
few "day traders," including Smith Barney (hey mb, were ya buying :))
placed limit bids about a handle to half a handle above limit down, and
bang! they halted the decline before it went to limit offer. where were
the pit traders? standing around with their hands in their pockets or
covering their badges, terrified by the tidal wave of selling cresting
across the pit. so, my long term trading dude, those spec day traders
and a few commercials provided much needed liquidty at a time when the
market nearly melted down.
again, i repeat, i consider providing liquidty one hell of an economic
incentive for money to flow from trend traders, commercials, and pit
traders to off floor day traders. without us, liquidty would dry up and
you'd be bitching about the excess slippage :))
the perceived advantages of pit trading are greatly exaggerated in this
day of instantaneous communications, high speed datafeeds, electronic
trading, and pit commentary via squawk box. and because off floor day
trading offers greater incentives than pit trading, many previous pit
traders (small and large lotters) are going to electronic off floor
trading now.
TJ
scott hoffman wrote:
But it is my feeling that daytrading off floor has no fundamental
economic reason as to why money should flow to the off-floor daytrader.
There is a very valid economic reason as to why money should flow to
floor traders, as a group. Of course it has to do with liquidity.
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