The work of the Stock Exchange

Bibliographic data

Monograph

Identifikator:: 1831284952

URN:: urn:nbn:de:zbw-retromon-225876

Document type:: Monograph

Author:: Meeker, James Edward http://d-nb.info/gnd/126597340

Title:: The work of the Stock Exchange

Edition:: Revised edition

Place of publication:: New York

Publisher:: The Ronald Press Company

Year of publication:: [1930]

Scope:: XVI, 720 Seiten; Illustrationen, Diagramme

Digitisation:: 2022

Collection:: Economics Books

Usage license:: Get license information via the feedback formular.

Chapter

Document type:: Monograph

Structure type:: Chapter

Title:: Chapter IX. The odd-lot business

Collection:: Economics Books

244 THE WORK OF THE STOCK EXCHANGE certain that his sales will be the last of the day. The only practice which is just to everyone is, therefore, to execute orders at the close on the final bid and asked quotations. Limited Orders in Odd-Lots.—Another set of misunder- standings is occasioned by limited orders for odd-lot purchases or sales. A limited order, as we have previously noticed, is one which fixes a certain price at which a customer will buy or sell a stock. A buyer may stipulate, for example, that he will not pay more than 75 for the 25 shares of Pennsylvania Railroad he wishes to purchase. Similarly, an investor who has 30 shares of Eastman Kodak, may instruct his broker to sell it if he can get 250. Such limited orders are always executed at the price limits set, and as soon as the appropriate price for 100- share lots is reached, that is, as soon as 100 shares of Penn- sylvania sell as low as 747%, or 100 shares of Eastman Kodak sell as high as 25014, the execution of these orders—one at 3 and the other at 14 from the 100-share sales—is automatically effected. Yet even this uniform rule occasionally leads to misunder- standings. For example, a customer might give his order to purchase 20 shares of General Motors at 80. After selling at 81, General Motors might drop on the next 100-share sale to 79, thus moving through So without actually recording a sale at that price. In such a case the odd-lot dealer would sell the 20 shares to the customer’s broker at 80. The customer might object that the next sale had really been made at 79, and that therefore he should get his 20 shares at 7974. Yet he has pur- chased the stock and received it at the price he himself has named. If the order to purchase 20 shares of General Motors at 80 is received by the odd-lot dealer and is therefore “in the market” before the sale of 100 shares at 81, it is considered a bid for stock and is therefore executed subsequently at its limit of 80. But if this 20-share order comes into the market after the sale of 100 General Motors at 81, it is then executed 14 away from the next sale, or at 7914. In other words,

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