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Questions about buying on the open:
1. What is the recommended way to order if I want to buy on the opening
when the series is expected to open lower, and I want to invest a certain
dollar amount? The best guess might be 3 5/8, but anything between 4 1/4
and 3 1/4 is possible. I want about $5000 worth at the opening price,
whatever it is.
2. On this kind of opening, when the series will open lower reflecting
action in the S&P futures, how much effect do initial orders have on the
opening price? I mean, if the market maker deems 3 5/8 the fair price based
on the futures, so that without any orders he would initially quote
3 1/2 - 3 3/4, is that determination modified because someone wants
to buy or sell 20 or 30 at the market, or will it be 3 5/8 regardless?
I'm speaking of moderate size, not big-time pressure or support.
Another angle: if I order 20 at limit 4, will the price tend to be higher
than if I ordered 20 at the market? Or no difference?
W.M.
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