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Some confusion can arise because of the inconsistent use of the word
'stop'.
When I use the word 'stop' I use it to refer to both Stop Limit and
Stop Market orders.
Some places, like IB, use 'Stop' to refer to what I call 'Stop Market'
orders.
The confusion gets worse when one considers 'twists' to stop orders.
For example, Globex may hold native stop limit orders (indeed, 'native'
means they are held in Globex computers), but not all stop limit orders
have to be 'native. FCMs may be holding more complicated kinds of stop
limit orders on their own computers, as John Lothian explained in his
email.
Regards
DanG
EarlA wrote:
<blockquote type="cite"
cite="">
Andrew,
I don't have the history. To the best of my knowledge, Globex started with
native Limit orders only and added native Stop Limit orders a couple of
years ago. Order handling for Globex is as described. As far as I know, all
other order types are pseudo order types hosted on broker machines. There
are some pseudo order types which are unique to IB and PATS which are hosted
on the client computer.
Earl
----- Original Message -----
From: "AndrewN" <tradera@xxxxxxxxxx>
To: <realtraders@xxxxxxxxxxxxxxx>
Sent: Friday, May 02, 2003 2:45 PM
Subject: RE: [RT] Stop Orders
Earl,
Yes, I am well able to read, which is why I asked the question for
clarification.
You stated that, "Stop orders are pseudo orders ... they are held on the
broker computer until the stop price is hit in the broker's data stream,
then released as a Limit order to Globex with an offset from the current
bid/ask."
However, in January 2001, in clarification of a post from John Lothian,
you
stated that, "b) stop orders, depending on order handling system deployed
by
the broker, are held in one of 3 places: a broker "folder" on the exchange
servers, the broker's own servers, or the remote client computer...."
The point being that stop orders used to be held at Globex, if required,
(not as part of the order book, but then neither are stop/limits according
to the CME Rulebook), and you stated that stops are held on brokers'
computers [or remote client computers].
So, I'll repeat my question. Has this [where stops are held] changed? And,
if so, do you know when?
Andrew
-----Original Message-----
From: EarlA [mailto:earl.a@xxxxxxxxxx]
Sent: Friday, May 02, 2003 2:13 PM
To: realtraders@xxxxxxxxxxxxxxx
Subject: Re: [RT] Stop Orders
Please the enumerated description of how Globex handles various order
types
... it's all there. I posted it no more than a hour or two ago.
Earl
----- Original Message -----
From: "AndrewN" <tradera@xxxxxxxxxx>
To: <realtraders@xxxxxxxxxxxxxxx>
Sent: Friday, May 02, 2003 12:02 PM
Subject: RE: [RT] Stop Orders
> Earl,
>
> I had always understood that, for most brokers, Globex held STOP
orders
on
> a separate computer and sent them in to the main matching engine as a
> simulated market order when elected. I recall that this was the
subject
of
> much discussion last year when comparing IB's method of holding stops
on
its
> own computers versus those of Globex.
>
> I note from IB's web site on Globex orders that Globex has a simulated
stop,
> which would be what I 'm referring to. Has this changed?
>
> Andrew
> -----Original Message-----
> From: EarlA [mailto:earl.a@xxxxxxxxxx]
> Sent: Friday, May 02, 2003 1:36 PM
> To: realtraders@xxxxxxxxxxxxxxx
> Subject: Re: [RT] Stop Orders
>
>
> To be clear, when referring to Stop Limit orders, two prices should
be
> specified: Stop price which triggers the order and Limit price which
> specifies the limit for execution.
>
> If your order is 10.00/10.00 and price passes from 10.02 to 9.99 in
a
> single
> trade, your order is triggered but will not be filled until price
trades
> at
> 10.00 or higher. I would not hesitate to use a 10.00/10.00 for entry
but
I
> would use either a Stop Limit with very wide spread or a straight
Stop.
> The
> choice depends upon order handling at the exchange being traded.
>
> Earl
>
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