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Zecco.com » General Investing » New Investors » BID / ASK
Last post 05-10-2008, 10:17 AM by DracMonster. 7 replies.
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  •  05-08-2008, 1:36 PM 28735

    BID / ASK

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    If a stock is trading at 11.79 and I place an order to buy 100 shares at 9.25. If someone places an order

    to sell at 9.25 will the order be executed ?

     

  •  05-08-2008, 2:00 PM 28740 in reply to 28735

    Re: BID / ASK

    Reply Quote
    If someone places an order to sell at 9.25 or better that order will be filled at the best price available if the best price is 9.25 or more.

  •  05-08-2008, 2:02 PM 28741 in reply to 28735

    Re: BID / ASK

    Reply Quote
    The sell order would most likely be executed at whatever the current bid is.  Automated trading systems will seek to fill the order in the most advantageous way possible for the party seeking to trade.  The only way the sell will go below market is if it is a stop-loss.  Your buy order below market would only be executed when the ask hits that point, or if you become the top bid and someone issues a market order sell.

  •  05-08-2008, 5:23 PM 28750 in reply to 28741

    Re: BID / ASK

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    I have seen huge blocks of stocks sold below the market price. Market price is 9.30 and at the

    same time I see 15,000 shares sold at 9.19. How is that possible ?

     

    In my example, I don't see anyway my buy order for 9.25 would be executed unless the

    market price dropped to 9.25.

  •  05-08-2008, 6:47 PM 28758 in reply to 28750

    Re: BID / ASK

    Reply Quote
    Your answer is in your question - huge blocks of stocks. If someone wants to sell 15,000 shares at 9.19 and checked the AON (all or none), then even though you are paying a better price of 9.25 your order does not fill the size of the offer. So, only the bid of 9.19 (or higher) of that size (or bigger) will be executed.

  •  05-09-2008, 6:17 PM 28827 in reply to 28750

    Re: BID / ASK

    Reply Quote
    MRPARKLAND:

    I have seen huge blocks of stocks sold below the market price. Market price is 9.30 and at the

    same time I see 15,000 shares sold at 9.19. How is that possible ?

     

    In my example, I don't see anyway my buy order for 9.25 would be executed unless the

    market price dropped to 9.25.



    As the above poster said, someone sold a huge block of shares as a market order, and the broker had to dig out a lower bid in order to fill it. The market price would then have been 9.19 for a split second until some smaller easier to fill order went through at the normal price. (There's a good chance a stop would have been triggered.)

    As long as you have set a limit order, it will not be filled unless Zecco can actually procure the shares at that actual price or better.

  •  05-09-2008, 6:54 PM 28830 in reply to 28735

    Re: BID / ASK

    Reply Quote

    No it wouldn't.  If they place a stop loss at 9.25 it won't go through until the stock is trading at 9.25.  Any orders other than that would execute around 11.79.

  •  05-10-2008, 10:17 AM 28856 in reply to 28830

    Re: BID / ASK

    Reply Quote
    If 15K shares went through at 9.19 then the quote very briefly was below 9.25 which would trigger the stop. It would turn into a market order at that point, and might very well execute at a price nowhere near the stop.

    Note that I did not mean the original poster had placed a stop (he placed a limit order) I meant someone else's stop might have been triggered, which would have explained the wierd price movement.
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