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Dear doctorOEX,
I experienced a problem on Friday that perhaps you could explain. Thursday
PM I bought a five lot of November 720 OEX puts through Preferred Trade
online brokerage. Friday morning the market rallied a bit on the open and I
bought a 5 lot of Nov 725 puts. Then the OEX began sliding and the puts
went deep in the money. I placed limit orders to sell(using the current
Bid) which means they did not go through RAES but into the CBOE book I
think. OEX was slidding pretty fast and obviously the limit prices were
exceeded and the orders should have been filled but no confirmation from the
CBOE came. I got on the instant messanger with Preferred Trade and they
said they were not getting confirmations back from the CBOE. OEX continued
to slide to 715, still no confirmations. OEX turned up and I got on the
voice phone to Preferred Trade and they said they were not sure what the
problem was but that they could not get confirmations by phone either and
there was no responce back from the CBOE on their datalink. Meanwhile the
OEX began its move up and the 720 went into a loss and the 725 had minor
gains. Finally PT erased the sell orders from my account and I reentered
them as market orders and they filled instantly. What I would like to know
is were your buddies on the floor too busy handling the big orders ignoring
my tiny five lots or was the book too full to get around to mine before the
market turned. Did the flow rate of orders even come close to stretching
the capacity of serving retail clients? Additionally, was RAES functioning
properly Friday morning on the dip to 715 and would those initial sell
orders have been better served by RAES? Was RAES functioning properly
Friday morning? Were they infact routed to a book that was not serviced in
a timely manner because of other priorities? Thanks for your answers and
insight to exiting oex positions during busy times.
Bob Roeske,
one pissed off trader
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