stock market question...

[stonerdave]

I was reading about my stock on yahoo's message boards, and came across these 3 posts...



<< Re: we may get past 5 1/4 soon the high

Msg: 9374
byollar00
msa, you need level 2, to see the market makers in action , and for the time and sales and time and quotes at real time
>>






<< Re: we may get past 5 1/4 soon the high
by: MSA_52897
Msg: 9375

Level 2 ?? Where do I get Level 2? Do you pay for it monthly, yearly and if you do is it worth the investment?

thanks again,
MSA
>>






<< Re: we may get past 5 1/4 soon the high
by: dollar00
Msg: 9376

see if its offered through your brokerage,, i get it through etrade, since im an active investor,, its free,, probably costs around 3000 a year i would guess, it may be offered through someone else for much less,, i couldnt trade without it,
>>



Could some elaborate on &quot;level 2&quot;? How do I find it on etrade? (btw, the stock is IWAV, interWAVE Communications)

thx

 

[Namuna]

Correct me if I'm wrong, but 'level-2' I believe refers to extra accesses of information via NASDAQ.

Specifically:
Time &amp; Sales (This is cool, you can watch transactions as they happen)
Inside Market (You can see the bids and asks, and who's making them)

There's probably more to this.

 

[stonerdave]

thx- I found it on etrade's site, but you must be a &quot;power trader&quot; to take advantage...you have to trade 75+ times/qtr. That's a little out of my league! just curious what those 2 were talking about on yahoo's boards.

 

[Handle]

Level 2 is especially useful on the OTC-BB where the stocks are often thinly traded. You need L2 (level 2) in order to see where all the market makers (MMs) are positioned with respect to the bid and the ask. From that, you can tell where levels of resistance are (for example, if one MM is on an ask of $0.40 and seven other MMs are on an ask of $0.75 then you can expect a nice spike with buying volume).

I don't personally have Level 2, so this is just based on what I've read. You'll see things like NITE, HRZG and other market makers there.

 

[JohnGalt]

usually you need to file an appliciation to your broker asking for it. They will ask you how much money you have, how many years you've been trading, etc, because L2 trading invovles options and people lose 90% when they buy options.

 

[Michael]

Level 2 has nothing directly to do with options.

It gives you the list of firms that want to buy and sell the stock and at what prices they want to do so.

Typical real time quotes (try Free Realtime give you the best bid and ask and how many shares are available. Level 2 expands the list with more detail.

Michael

 

[hans007]

level 2 is basically real time quotes with maybe a realtime chart as well, with number of shares being traded in real time. Etrade gives you it free if you make 25 or more trades a month i think. Dateks is kinda like that, and if you wanna see buying patterns go to isld