|
PureBytes Links
Trading Reference Links
|
RT,s;
I've been daytrading the S&P's for almost three years now. I had never been
to the Merc or even to Chicago until last week.
A little history first so you can understand impact of my visit to the pit.
I started trading with Jack Carl Futures (3 months) and then went to
Rosenthal Collins (for one year). I had an account over $100k so they give
you access to their floor desks for orders "near the market". Otherwise you
need to place orders away from the market through a desk off the floor.
I can't tell you how bad my experience was with these two companies. I would
not be trading today if I hadn't found my current broker. It would take 15
to twenty minutes or more (you weren't allowed to call them for fills) to
get fills back, you were treated like a number instead of a customer and
they were rude and very intimidating when you called to place orders. The
bottom line is that they did everything wrong in terms of customer service
because the guys working the desks had no vested interest in your success.
The broker I've been using now for almost two years is a CME member. He is
at the trading desk everyday. Your desire and willingness to trade directly
affect his bottom line and he is on your side fighting for better fills and
excited when you make a good trade. They answer the phone within two rings
quoting the bid/offer in the pit. They memorize your account number after a
few days so you just have to say, "this is Howard, buy five at the market"
and boom you order is arbed in to the pit.
Why am I going on and on about my broker? Because he let me stand down with
him at his desk in the pit for a day and 1/2. He introduced me to the
clerks and traders that fill my orders. Everyone was extremely nice and
friendly. One of the trader's let me stand next to him at the rim of the
pit and explained everything going on (Borsellino was just three guys away
from me).
It turned out that my former desk at Rosenthall Collins was right next to my
current broker. The asshole clerk Andy that had caused me so much stress
was still there. Andy was reading the paper, constantly horseplaying with a
guy from the Smith Barney desk, and answering the phone "S&P's" with no idea
where the market was because he wasn't even paying attention to the pit. On
Thursday morning the other clerk at Rosenthal Collins was asleep on the desk
for 2 1/2 hours... seriously, he slept from right after the open until
lunch!!!!!!! These were the guys that were placing my orders in the
volatile S&P!!!???
Conclusion: If all the guys/gals at your trading desk (there is more
females on the floor than I thought) are wearing gold jackets (clerks and
runner colors) than the people working your trades and orders probably have
no vested interest in your success or satisfaction with their service.
Other observations: Time/sales sequence is partially random. One guy
sitting up on a platform at the front of the pit keys in the trade prices
that are signaled to him from the traders. The pit has 300-400 people when
full. If he is looking to one side of the pit and someone signals a trade
he may have missed a trade a few seconds earlier from the other side of the
pit. At one point on the morning of 7/12, the price board showed the last
trade at 1509.00 while 1507.00 was actually trading. In other words, even
the board in the pit is delayed and that is why I always have a squawkbox on
and watch the emini's. Then you have a more accurate picture of where the
market "really" is.
Another thing I hear a lot of traders complain about is how locals have a
license to steal with the type of bid/ask spread we are seeing these days.
They do have an edge due to their ability to get in and out quickly and to
see order flow into the pit, but the truth is they have no more idea where
the market is going than you and I sitting at home watching our screens. An
example of this is Thursday before last (7/6) when the market began this
recent advance. My broker has a friend who's a great trader and an "A"
local. The market was near the lows and Merrill bid on 100 lot. The local
hit him. Then Merrill bid on another 100 and the local hit him again. Then
all the institutions started buying and drove the market up over 15 handles
in 45 minutes on what my guy estimated was 4000-6000 contracts. This local
got absolutely killed that day. He didn't 'know' what the market was doing
but placed a bet and lost...big.
Hope my field trip was as informative and entertaining for you as it was for
me. :)
Howard
________________________________________________________________________
Get Your Private, Free E-mail from MSN Hotmail at http://www.hotmail.com
|