Originally Posted by
blackcap
The problem with the sharesies algorythm is that it will not always bring a market order to market. It does not do that because it wants to keep markets orderly and not push the price. For example I was wanting to by a stock with a spread of 9.8 bid and 10 cents offered. I put in a market bid but the sharesies algorythm put my bid in at 9.8 so as not to "upset" the market. If they took the 10 cents then that would have been the first time the stock traded there.
So in yesterday's CBD example, the algorythm will put a market buy on the bid side but wait before someone takes some of the offer before moving your "market" order up to the next level. If all of the offer gets taken, well there is nothing left for the sharesies algo to take and they sit dutifully on the bid waiting for the next line up to get hit.
Yes it is easy to game it if you can see it on the depth, we have done so a few times in select stock.
Sharesies really need to fix this "bug" in their system or they will lose credibility fast.
(on the other hand, I understand why they have this protection in place. Imagine yesterday that market orders were processed exactly as that... market. Just buy what is available. On a low traded stock with low liquidity the CBD price by weight of orders and volume could have been purchased up to $2.50 before more serious punters were aware of it and pushed the price back to normal levels. That is why they have the algo, to create orderly markets.)