understanding a stocks depth

[rivka]

Hey guys

I am quite new to the stock market and this is my first post at Sharetrader as well.

the attached image is of EBO at 5pm.
The price at the time was $10.08, now why would someone offer to sell at $9.68 and another offering to buy at $10.50??

I have no idea to be honest and any help would be greatly appreciated
Thanks Rivka

5937

[Wolf]

During Market Pre Close between 4.45pm-5.00pm on the NZX trades entered will not trade until 5.00pm in which all orders are matched off.
The reason for people offering to sell or buy at certain extremes is to put themselves in front of the queue to make sure their order trades.
With EBO.NZ this evening the match price was $10.10 at close (5pm) so that is the price buyers and sellers would have recieved.

Here is a good article on depth tables.
https://www.anzsecurities.co.nz/directtrade/static/depthtutorial.aspx (https://www.anzsecurities.co.nz/directtrade/static/depthtutorial.aspx)

[stoploss]

Hi Rivka ,
this is the matching session, just like for the open of the market. So on the ASB system you see bids and offers on the ANZ system it will also tell you what the match price current is as well. So the system will match off the buys and sells roughly where the most volume can be transacted. You ask why would someone put those prices in . Well both the buyer and seller want to get set so they have gone a long way from the last traded price so they are the first matched off ... ( match was $ 10.10) . This is fine in a liquid stock as long as all the bids or offers don't disappear .... if they do, you could get set at the level you have input not where you thought you would ...... So a risky strategy in an illiquid stock . Hopefully this makes some sense, watch a few opens for highly traded stocks and I think you will get the idea.

[rivka]

Thank you Wolf and Stoploss.
Makes Sense Now, I was assuming that buyers and sellers were paired without any fixed price between them.
I will have to watch a few more openings and closes too.

Thanks Rivka

[Vaygor1]

An in-depth explanation of the opening and closing algorithm and process (with a neat example) can be found here. It relates to the ASX but I am sure the same algorithm applies to the NZX. In any event it will add clarity for you. Definitely worth reading, and absorbing.

https://web.archive.org/web/20130127...ose-prices.htm (https://web.archive.org/web/20130127102638/http://www.asx.com.au/products/calculate-open-close-prices.htm)


Another short thread that addresses this topic with a few comments from ST members including myself is here (I found Moosie's Blam-O strategy a most interesting read):

http://www.sharetrader.co.nz/showthread.php?9339-day-opening-price