Eh? I had a different understanding of the matter. As far as I know the volume put up for sale or volume to buy has no bearing which one is done first. As long as the queue exists after the price is same, the transactions will follow the queue of First In First Out system. It's kind of hard to illustrate with the forums, but if me and you key in different amounts at the same price, but the fact that I queue an hour earlier than you, I will get to sell first whether my volume is 1 lot or 1000 lot compared to yours.

Example;

I key in Sell order at RM1.05 for 2000 lots.

You key in Sell order of RM1.05 for 5000 lots 10 minutes later.

We are both currently queued at the SELL RM1.05 7000 lots.


Buyer wants to buy 5000 lots at RM1.10, but the system will match the lowest price to him which is RM1.05 which is currently in queue, so since I queued first, my 2000 lots will be sold and then 3000 out of you 5000 lots will be sold at RM1.05. We will not get RM1.10 although the buyer is willing to buy at that amount.

Whatever you see on the board on Sell/Buy orders are stuff that are on queues meaning they are on some kind of waiting list. If some buyer decide to come in and not follow the queue and buy at whatever price which is on queue, it will buy from the cheapest onwards. It cannot choose to buy the RM1.20 waiting lists and ignores the RM1.05 ones. It has to buy the RM1.05 waiting list first before able to move up.

Same for Sellers who have not queued. If for example I want to throw my shares for whatever price, it will gobble up the Sell queues from the highest to the lowest, regardless of the volume.

The system always Buy at lowest and Sell at highest. Whats not traded or not matched is what is being queued on the boards.

Queues are for people who can wait for their prices to be match. People who don't queue and buy whatever the market offers (queued) are called spot traders. Meaning they trade on the spot, without queue-ing.

Edit: Forgot to mention that it's good you started this thread, but would need some sort of moderation to keep it neat.

This post has been edited by skiddtrader: Apr 16 2008, 04:30 PM

By right, the system will not allow such a queue to exists. Because the queue represents what is not matched. So as long as prices are not match, it will remain in queue and displayed on the board.

But from your example, if the Buy queue was there first, and a Sell order came along for RM1.05, the transaction will be done at RM1.10.

If the Sell queue was there first at RM1.05, and Buy order comes along to buy at RM1.10, then the transaction will be done at RM1.05.

Do remember that when you key in on your online trading system to queue, it doesn't actually queue but rather send an order to see if it matches any prices on queue, if it does not, it will then be queued at the appropriate list.

What Bursa said is correct, and I'm not wrong either.

Always remember the system always buy at the lowest and sell at the highest.

So from my example, the buyer who keyed in RM1.10 but the system will match the lowest offer for him which was our RM1.05 sell orders. So the buyer even when he keyed in RM1.10, the system will buy for him at the lowest which is RM1.05.

If we turn it another way around, lets just say we both want to BUY instead and decide at RM1.10 and put it a BUY order queue of RM1.10 with the same amount of lots and at the same time I keyed in first before you.

I key in BUY order for RM1.10 for 2000 lots

You key in BUY order for RM1.10 for 5000 lots 10 minutes later.

A seller comes along and wants to sell at RM1.05 of 5000 lots because he read yesterdays newspaper about RM1.05 being the closing price. He keys in a RM1.05 order online without checking the price we have both queued.

So now, the system although receiving an order to sell cheaper will still match the highest bid on queue which is ours and the transaction will be done at RM1.10.


Both examples follow the Buy at lowest and Sell at highest.

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Added on April 18, 2008, 11:37 amI think in the © case, 50 lots will be done in RM1.05 and the rest will be queued at RM1.10 buy price if there isn't any higher Sell orders on queue. Since the lowest offer was RM1.05, and you bid RM1.10, you will get teh initial 50 lots at RM1.05 but your other half of RM1.10 will either be matched with a higher sell order or be queued if no other Sell orders are present.

This post has been edited by skiddtrader: Apr 18 2008, 11:37 AM