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Most of the stop orders are actually limit order of stop + 5 points.
That appears to be "norm". So if you see a run generated, there
will be people coming in to buy 5 points away cos they know they just
might get lucky and it will retrace back again somewhat else its a report
event. If you think you econometric model is superior to what's out there
that you want to have a position before a big report, ...
Nothing wrong with contracts traded electronically.
The E-mini is setup as a self sabotage. Remember when CME (I think)
said Oracle software was screwed up and Oracle came in and found that
the CME couldn't even design their database properly (rather elementary).
When you limit the maximum size in the Emini, you limit the number and type
of players.
A true evaluation of electronic trading is to look at happenings at
Eurex's, Liffe
or Matif. Not on exchanges that try to hamper e-contracts by limiting
liquidity,
putting self sabotaging interfacing networks to the clearing software,
having stupid
clearing algorithms (i.e. contracts traded in the US and what appears going
to be
happening to another exchange in Asia, time will tell).
At 07:48 AM 8/2/99 -0700, Dennis Holverstott wrote:
>i like the e-mini s&p a lot but you have to be aware of the gotchas, in
>particular the danger of stop orders. compare the reaction of the mini
>and the big s&p to the 10:00 napm report. the mini spiked 10!!! handles
>higher than the big.
>
>--
> Dennis
>
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