Suppose a scrip is trading at 100 but there is a limit buy order at 95 that one can see in the market depth. If someone places a sell order with the same qty at 95 will the trade get executed immediately, without scrip actually going to 95?
Also can anyone direct to any useful resources on tape reading and how it can be useful if it is useful at all?
yes … if there are buyers at 100 to 95rs and we place a sell order at 95rs , it will get executed well above 95rs…
do remember in equity we can use disclosed quantity as well
What do you mean by “yes … if there are buyers at 100 to 95rs and we place a sell order at 95rs” there can be n number of points between 100 to 95. Do you mean if the minimum tick size is 1 there have to be buy order of 99, 98, 97, 96 and 95 for it to get to 95?
Also let’s say if there is equal no of buy and sell orders on each side of the trade how does the ticker decides which way to go first? Does it chooses minimum distance or whatever the trader agreed to buy and sell if the price matches?
assume this is the order book and there is no hidden quantity …
price 100 bid quantity 500
price 98 bid quantity 500
price 95 bid quanrity 2000
if you place a sell order at 95 for 2000 quantity , then 500 will be sold 100rs , another 500 at 98rs and 1000quantiy at 95rs… ( again assume noone else is selling with you )
there is no such rule
recent order will get the best price …
lets assume there is a buyer already who wants to buy it for 100rs ( exact 100 shares ) , and now seller is placing an order that he wants to sell it at 95rs ( exact 100 shares ) …
order will be executed at 100rs … buyer will get it for 100rs and seller will sell it for 100rs ( even though he is ok to sell it for 95rs ) …
are you going through FIX protocol ? 
Not really but seems like a good idea to understand it.
as market says, limit orders only executes when scrip touches the level, it might not show to some terminals a technical reason.
this thing is against market, order executes only when buyer and seller are at same level, else market order. because if it happens there will be only buyers or seller in market depth.
plz suggest if i am wrong.
It will choose the price of recent order…
Exchanges measure time in 10^ -6 th of a second… i.e micro second
its unlikely that both the orders of 100 and 95 wud have been placed at the exact same time…( even exact microsecond) …Its also a major reason why top brokerage houses set up their head office very close to exchanges in mumbai…as there is a significant time delay before the data reaches other parts of the country…
So if 100 rs buy order is placed first, before the 95 rs one, then 95 rs sell is the latest order…
it will assume if someone in market is willing to buy at 100 then execute the trade at rs 100 and seller will get rs 100 per share not rs 95…
vice versa if rs 95 sell order is placed first then exchanges will assume if someone is willing to sell at rs 95 why bother buying at rs 100…
Hope this answers your question…
When there are buyers at 100 and you want to sell it at 95 , its already in your level
can you explain how
Limit buy 100 order mean you are willing to give MAX 100 for the share. Not more.
So if someone is already selling at 95 only you will get 95.
Limit sell 100 mean you want MIN 100 for your share, not a dime less.
But if somebody already willing to buy at 105, exchange will give you 105
good you are spreading knowledge,
but, you might have just jumped to last post, haven’t read the topic post
these are main parts for you to understand the topic my friend, i think now you can understand the topic and post accordingly.
I have no khhaj of spreading knowledge.
I haven’t jumped any last posts.
Only fault is that I severely misjudged the IQ of some people leading to catastrophic consequences.
My sincere apologies.
I have properly answered the question. If some points are still unclear ask straight by pointing out the specific point
It seems as if the “level” concept is bothering you.
There is no such thing.
If LTP is 100 and you put buy limit of 105 then there is no need for LTP to go up to 105 level.
also if LTP is 100 and you put in sell limit of 95 there is no need for price to go down to 95 level.
In first case trade will be executed at 100 only with LTP remaining unchanged if enough shares are availabe. Even though you told exchange that you are willing to pay as much as 105 you will still get 100 only.
But if you put BUY limit below LTP, then as LTP is 100 and you put in buy limit of 95, no trade occurs as you are willing to pay max 95 and no shares are available at that level. Currently you need to pay minium of 100 to buy. So in this case you need to wait till the level of 95 is reached.
Who the f. says this??? You have completely misunderstood the concept. Limit Buy order lower than LTP and Limit Sell above LTP only wait till levels are reached.
Else the orders are treated as Market orders only
assume there are buyer who wants to buy at 100rs … and you want to sell it at 95rs , system will match both the orders.
here you would sell it for 100rs even if you put a limit sell order at 95rs…
ps:
most probably in US , m2m will match both the orders and they will take 5 points … mean m2m will buy it at 95 from you and sell it at 100 to other
sorry, i thought you can understand the query, but you can’t even understand the market.
lower than LTP or higher than LTP was not the topic dear, stay away of the topic you are not clear of.
friend,
thanks for explaining, but i have below struck in my mind
and you answered “yes” to this,
might the questioner wants to ask something different, but what my query is
when the buyer @95 sell order placed @95, but the stock price @100, so how can that execute, when no buyer or seller at stock price. there must be a seller for a buyer or vice versa, but both are @95 and price didn’t reach the level.