| Symbol | MSFT | INTC | CSCO | Limit | | Order #1 | Buy 1000 | Sell 2000 | | Pay $10,000 | | Order #2 | | Buy 1000 | Sell 1000 | Pay $10,000 | | Order #3 | Sell 1000 | | Buy 1000 | Receive $50,000 | | Total | -0- | Sell 1000 | -0- | Receive $30,000 |
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Our order matching system gives your order lots of ways to find a mate.
It can trade against market makers, other limit orders that are internal
to our system, one-sided national market prices, or a combination of
these.
Here's an example. Suppose the three orders shown on the left are in our
system. Of course, none of these orders matches against any other.
Note, however, that the sum of the three orders, after netting, yields
the one-dimensional order: SELL 1000 INTC / Receive $30,000.
Therefore, when our system observes the first three orders it places a
one-sided order to SELL 1000 INTC @ $30 in the national market on behalf
of order #1. If this trade is, indeed, consumated then the system uses
it to complete all of the trades in the example. (All of the MSFT and
CSCO, and the remainder of the INTC and Dollars net out to zero.) Now
that's a match.
P.S. There are other one-dimensional orders that the system can
generate. For example, if the system can SELL 500 MSFT @ 70 on behalf
of order #3, then it can create a match from this order plus one-half of
order #1, and all of orders #2 and #3. Aren't you glad you don't
have to do the match math?
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