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Regarding spread size, ....
This past Thursday I visited various pits in the CBOT
and the Merc. Walking in and around them, I had the
opportunuty to talk to several traders, watch them
compete, and really get into it.
With all the games these guys play, as well as the sheer
energy required for getting the trade, I can see how
addictive the adrenaline rush can be.
However, one common "complaint" was that the
opportunity for making big bucks trading in the pits is
coming to an end. Profits were being squeezed out by
computerized trades, and ever decreasing spreads. Floor
traders are working harder and earning less. Many are
calling it quits.
The only pits increasing in size were those related to
Eurodollar derivatives. I was told that many of the
best and brightest floor traders have migrated to
that arena.
- mark
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From: Greg Darke
Sent: Wednesday, May 16, 2001 5:19 PM
To: omega-list@xxxxxxxxxx
Subject: Re: Dual CPUs
Bilo
> you bet. things changed since the decimalization in equities, esp in Naz.
> short term price volatility increased and noise level went up
considerably.
> spreads are now negative many times especially ecn spreads.
> snip
> i consider it yet another blow to the daytraders.
Interesting you should say that. My experience has been the exact opposite.
In my experience, quoting in decimals has resulted in far "smoother" moves
intraday, and I've found slippage (on direct access directed orders) on
stops to be vastly improved.
Greg
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