Road Blocks in the Buy & Sell Queues

When we buy or sell our shares, we would want to transact at the best price. At the same time, we must ensure that we queue at a price level where our orders will be done. Queuing at an unfavourable price level will lead to our orders not done, thus leading to investment losses.  

The Market Depth feature in ShareInvestor Station allows us to see the number of lots queuing to buy/sell at each price level. With this, we are able to spot the price levels with massive volume. We can then decide to queue to buy at the price above the massive volume or sell below the massive volume.   

Case Study: Keppel Corp

On 30th Mar 2017, Keppel Corp opens at $6.96 and the price marches towards $7.00. On this day, if we would like to sell the shares of Keppel Corp, what price should we queue at?

When we view the Market Depth, we can see a long sell bar at the price of $7.00, with approximately 321 lots queuing to sell. In order to ensure that our sell orders are done, we should queue at the price of $6.99. This will beat the massive volume queuing to sell at $7.00.   

Market Depth

 

After hitting $7.00, the price starts to fall and it closes at a low of $6.89. Queuing to sell at $6.99 ensures that our sell orders are done, yet allows us to sell at the best price for the day. At the price of $7.00, minimal lots are transacted (only approximately 5 lots transacted). We can see this from the Trade Summary Matrix (TSM) in ShareInvestor WebPro and Station.    

Trade Summary Matrix

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Disclaimer:

The mentioned stock should not be taken as an advice to buy or sell. Each user should go through with his usual self-analysis of his risk appetite and perform additional due diligence before making any investment or trading decision. Your Trading Representative should be consulted before making any financial decision.