Fast moving markets are markets that experience heavy trading volumes and wide price fluctuations within a short period of time. These conditions often result when there is an imbalance of orders on a particular "side" of the market (i.e. buy vs. sell) and when there is wide speculation in a security. Although fast moving markets typically occur in only a relatively small number of stocks, fast markets can and do affect the trading environment for all investors. It is therefore important to understand these trading conditions and to know the available options when placing orders.

1. Delays in executions or reports of executions from market makers.


2. Market orders executed at prices dramatically different from the quotes available at the time of the order.


3. Longer waits to access accounts electronically and over the phone.


4. Suspension of electronic trading access for certain stocks. Trading may be through telephone representatives only.


5. Changes in margin requirements for certain volatile stocks.

Knowing the available options is one way to provide protection from the increased risks of trading in fast markets.

1. What is a market order?


2. What is a limit order?


3. After I have placed an order, can I change or cancel it?


4. If I make a mistake and place an order twice, do I have to pay for both orders?


5. What does it mean when a stock is suspended from electronic trading?

1. Why do quotes sometimes differ significantly from the actual market price?


2. Why am I waiting so long for executions?


3. Why was my order executed at a price?

1. How have margin requirements changed for volatile stocks?


2. What is a "Freeriding" violation?

Unless otherwise specified, orders are placed as market orders. Market orders must be executed at the prevailing market price when the order reaches the market, even if the market has moved dramatically in a short period of time. Therefore, market orders entered when markets are open are usually executed shortly after they are entered. In fast markets, the report of the actual execution can be delayed significantly.

In a fast moving market, the price an investor receives for a market order can be significantly different from the price quoted. When demand for a stock is strong and supply is limited, the price of the stock may change dramatically in a very short period of time.

When entering a market order, I/we understand that I/we am/are responsible for the price that I/we ultimately receive.


Investors can use a limit order to set a maximum price that they are willing to pay or the minimum amount that they will accept to sell a security. Investors can also specify whether the order is just for today (day order) or whether it is good 'til canceled (GTC - which expire after a calendar month or can be canceled by the customer up until the time the order executes). Investors are not guaranteed execution of limit orders. If the market price for the security does not meet the parameters contained in the order, the order will not be filled.

In a fast moving market, entering a limit order sets a ceiling or a floor on the price you are willing to accept. This can reduce your exposure to price volatility.


Some orders can be modified or canceled and some cannot.

MARKET ORDERS: Since market makers must execute market orders promptly at the price prevailing when the order reaches them, market orders will generally already have been executed by the time any instructions to modify or cancel are received. Remember, not having the report of an execution yet doesn't mean the order hasn't executed yet. You can place a request to cancel, but this may be accomplished only under unusual circumstances, such as when a stock stops trading during the day.

LIMIT ORDERS: You can request to cancel or modify a limit order, and StockCross/NetVest will make a "best efforts" attempt to do so. It is possible for your order to be executed before your instructions to modify reach the market, in which case your order cannot be canceled.

If you make a mistake, call a representative or otherwise try to cancel the duplicate order immediately. Bear in mind that not all orders can be canceled. If you place two orders, even if one is a mistake, you are responsible for both orders. Every order represents a commitment to settle the trade when executed.

If you are waiting for an execution report on an order you have placed, do not reenter the order. Entering an additional order will not speed up or force an execution of the first order.

If you request to cancel an order, first be sure that the order is confirmed as canceled before placing another order. You can verify that an order is canceled by speaking with a registered representative.


In certain markets when a security experiences extraordinarily high price volatility or trading volume, NetVest may suspend the security from trading through the electronic Services. If a security becomes restricted from electronic trading, any orders for that security may be placed only by calling and speaking with a registered representative.



"Real-time" quotes reflect prices at which trades have been executed, not the price you will receive. When the market for a security is moving quickly, the price can move dramatically even in the short interval between the time the order was entered and the time it is executed.


Market makers may take longer to execute orders when volumes are high and/or there are imbalances in the number of buy and sell orders. The market makers may also be executing orders manually (rather than using automated systems) or reducing their size guarantees, which can also delay executions. Under these conditions, you may not get the instantaneous report you might expect.


When trading volumes are heavy, there may be delays in market makers ability to execute orders. If prices are moving rapidly, the actual price you receive for a market order may differ dramatically from the quote available when you placed the order. With Limit orders, rapidly moving prices may lead to your orders being executed sooner than you may have expected.



In response to the recent volatility of certain stocks, the initial and margin maintenance requirements for these stocks has been raised to 70%. This affects a relatively small number of stocks, mostly from internet-related companies and certain companies that are going public (IPOs), particularly the IPOs of internet issuers. For a recent list of these stocks with higher initial and margin maintenance requirements, click here.


When trading securities, the full purchase amount for the security bought must be paid by the settlement date for the trade. Settlement date for stocks is normally three business days after the trade is executed. Any proceeds from the sale of securities will be credited to your account in the same manner, generally three days after the sale is executed. This is especially important to remember if a security is bought and sold in the same day. The security purchased must be paid for in full in order to avoid a potential trade violation.

If proceeds from the sale of a security are used to pay the amount due from the purchase of the same security, a violation of the Federal Reserve Board's "Regulation T" will have occurred. This is known as freeriding. Securities regulations require the account in which the trade violation occurred to be restricted for 90 days. During the 90-day "restricted" period, we will require that the account have 100% of the purchase amount available before accepting a new buy order. Accounts that are restricted are also blocked from entering trades electronically.