Institutional Equities Trader

A flash fill is one for which you may remain on hold as your order is handsignaled to the pit. Although there will be some conditions in which delays are understandable, such delays are anathema to the day trader and must be avoided whenever and wherever possible. Know which exchanges will accept certain orders. The rules change from time to time and from one market condition to another. If you don't know the rules, find them out. The Chicago Mercantile and IMM will accept almost all orders almost all the time.

The Chicago Board of Trade is a stickler for accepting only certain types of orders-it does nOt accept MITs. Some New York markets have restrictions as well. Orange juice is one of the most notorious markets, but then you probably don't want to and shouldn't day trade OJ.

Find out how your broker places your orders. Does he or she call the floor? Are your orders put on a wire for execution? Does your broker need to call someone who will call someone else who will then call someone else? This all takes time. Day traders can't afford the time for such delays.

Ask your broker for his or her procedures and deal only with those brokers who can get you the fastest fills. Anything else will The Importance of Orders 147 cost you money no matter how low the commission rate. Don't be penny wise and pound foolish. Globex (24-hour) trading requires even more discretion in order placement. Be very careful. Learn the rules and learn to deal with the lack of liquidity. If trading futures options, use price orders all the time.

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