Introduction > Intelligent orders for US Stock Exchanges > PEG Middle

PEG Middle

This intelligent order allows securities to be bought or sold under better conditions than a direct purchase using offers or sale using bids. The goal of this order is to position a bid or offer in the middle of the two best quotes (between the best offer and the best bid).

Use PEG middle for trades involving titles with lower liquidity.

Example of use:

An investor wants to realize a buy or sale in a relatively short about of time to take advantage of a better price for a purchase when compared to an offer or for a sale when compared to a bid from other participants in the market (e.g. different from the best bid or offer). The PEG Middle intelligent order is placed on the market quote directly in the middle between the best bid and the best offer. The quote at this level freely moves until its settlement and in the worst case it moves to the "Limit Price" (always to ensure that the quote is the arithmetic average of the best bid and the best offer). This type of order is recommended on markets with low liquidity with an average volume of up to 200,000 shares (where there is a chance of a large spread between the best bid and the best offer) or for a large order:

An investor is interested in buying 150 shares with a Limit Price of USD 9.90 using the PEG Middle intelligent order. From the moment the order is sent, the quoted price between the best bid and the best order is shown (through all ECN), i.e. in this case at USD 9.75. If the Limit Price for the best offer decreases from USD 10 to USD 9.96, the change is automatic in the quote to USD 9.73 (i.e. to the middle of the best quote).

Placing an order:

An investor is interested in buying 150 shares of a security with a Limit Price of USD 9.90 using a PEG Middle intelligent order. From the moment the order is sent, the quoted price between the best bid and the best order is shown (through all ECN), i.e. in this case at USD 9.75. If the Limit Price for the best offer decreases from USD 10 to USD 9.96, the change is automatic in the quote to USD 9.73 (i.e. to be middle of the best quotes).

ORDER PARAMETERS:

Direction: Buy

Limit Price: USD 9.90

Quantity: 150 shares

Before order is placed:

Price (USD)	Cumulative number of shares
10.50	2,000	Offer
10.30	1,200
10.20	700
10.10	500
10.00	400
		Middle
9.50	5,500	Bid
9.45	6,000
9.30	8,000
9.25	10,000
9.10	11,000

After order is placed:

Price (USD)	Cumulative number of shares
10.50	2,000	Offer
10.30	1,200
10.20	700
10.10	500
10.00	400
		Middle
9.75	150	Bid
9.50	5,650
9.45	6,150
9.30	8,150
9.25	10,150

Order is placed as a bit at USD 9.75.

After best offer changes:

Price (USD)	Cumulative number of shares
10.50	2,000	Offer
10.30	1,200
10.20	700
10.10	500
9.96	400
		Middle
9.73	150	Bid
9.50	5,650
9.45	6,150
9.30	8,150
9.25	10150