Level 2 trading software uk

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I show how to do this in my free ebooks which are available below. One advantage of using Level 2 on SETS is that we can see the current price, and if we want to work a large order at a specific price then we can use the iceberg functionality. An iceberg order is an order that is split into tranches and reloaded through the use of an automated program.

Icebergs can be useful for short-sellers as they soak up the bid and remain the highest price as each tranche is reloaded unless someone outbids them — remember the highest bidder is the highest price. On the right-hand side of the Level 2 screen, there is another column that shows a list of prints both in red and blue.

The red orders are printed as sells and the blue orders are printed as buys. This is the list of recent trades and their market prices with the time printed on the left-hand side of the order. We can see that on the right-hand side of the print there is a two-letter code, either AT or OB.

For example, if someone had 10, shares on offer at p, and I bought those shares using direct market access, the trade would print in the market as a buy with an AT trade code.

Enter your email to receive my free UK stock trading handbook, packed with professional techniques to manage risk and consistently profit on AIM stocks. This system is primarily a market maker driven as we are only able to access the order book at certain times of the day. SETSqx also has an opening auction and at until the market makers registered to deal in the security are obliged to offer firm quotes to buy and to sell in that stock.

SETSqx live data can be viewed again with a Level 2 subscription. Often in shares that only offer market maker trading and no direct market access other than the auction the liquidity is lower. This is because dealing only takes place via market makers and we have to buy and sell at the prices they offer and provide.

You will notice that there is a lot less information here. This is because to trade SETSqx stocks we need to trade through market makers. Market makers are specific firms that take on market risk by offering a two-way price in order to provide liquidity to us.

In return for that risk, they make the spread on stocks. The spread is the difference between the buy price and the sell price. In this case, we can see that the spread is 10p as the bid is p and the ask is p.

At the touch, we can see codes instead of the orders that appear on SETS. These codes are the market maker mnemonics. This is the size that the market makers are obliged to deal in when dealt with over the telephone. In this example, if we were to use our phone broker to buy or sell shares in Eagle Eye, then the market makers would be obliged to deal up to 1, shares at the price they are quoting on the Level 2 screen.

However, the market makers are not obliged to deal in NMS when dealt with over an online execution broker. The RSP is the service that connects us and the market makers in order to deal. We can also see on the ask that there is only one market maker INV. Firstly, by making the stock look well bid it encourages market participants to buy.

And if the market maker is a seller then it makes sense to market the stock attractively on Level 2. We can see that there are three market makers on the bid, and we can see that SCAP moved up their pricing at — the most recent market maker change.

It would be wrong to assume that because there are three markets on the bid on Level 2 this means the stock is well supported. We can see that Berenberg BERB are very keen to buy stock from us remember we sell to the market makers who buy our shares and will bid us , shares at the asking price! However, none of the other market makers is firm at 2p. This could also be due to the size of the quote.

The Normal Market Size is only 25, shares and this quote is way above the trading sizes going through on the Level 2 screen. Using various order sizes will show market makers at different prices and help to give an idea of how well a stock is bid and offered. But as it is clear, using Level 2 alone is not enough to gauge the market. PRO TIP : When checking market depth it is important to vary up the quote sizes to build an idea of supply and demand. Therefore, Level 2 is of diminished value when dealing with an online broker as we may not be able to buy at the prices displayed online.

However, if you have a phone broker it can be extremely useful as you can direct your orders to specific market makers. In short term trading, Level 2 can be used to see how the market makers are lining themselves up on the order book. Market makers will often follow each other when ticking up and down, and so if we see one market maker begin to tick up after a fall then we can guess that others will follow.

Market makers are there to provide liquidity for the market takers, however, we must remember that the market makers are also there to make a market for themselves. Market making is not a charitable activity and so we know they make their money on the spread. Inbox Community Academy Help. Log in Create live account. Related search: Market Data. Market Data Type of market. Create demo account. Create live account. Log in. Why trade on L2 Dealer?

Compare market sentiment Assess whether other market participants are currently bullish or bearish before taking your position. Benefit from anonymity Take a position anonymously and slice large orders into tranches to hide your full size, especially if it could affect market prices.

Enter auctions Increase your chances of getting the best prices by entering auctions. Is L2 Dealer right for me? Find out how to get started with L2 Dealer. What can you trade on L2 Dealer? FX DMA is only available to professional clients. Learn more about DMA.

What are Level 1 and Level 2 data? Level 1 data will give you pricing directly from an exchange. L2 Dealer features. Set alerts to notify you when your pre-determined market conditions are met. Open an account to access L2 Dealer. Android App. Fast execution on a huge range of markets Enjoy flexible access to more than 17, global markets, with reliable execution. Deal seamlessly, wherever you are Trade on the move with our natively designed, award-winning trading app.

How to get started with L2 Dealer L2 Dealer is for experienced traders. Learn more about DMA Decide whether you want to trade share CFDs or invest in shares directly Open a trading account or share dealing account Fill in the form below to get your L2 Dealer download link If you already have an account, log in here.

Register for L2 dealer. Email address. I have read and understood the L2 Dealer Manual. Learn more about DMA Available for professional clients only Fill in the form below to get your live L2 Dealer download link If you already have an account, log in here. To upgrade simply: Open a trading account to trade share CFDs or a share dealing account to invest in shares directly Fill in the form below to get your L2 Dealer download link If you already have an account, log in here.