Hi Chris, thanks for getting back to me with my last question; your answer was really helpful. I actually have a few more questions. I was using a Nasdaq Level II demo on the Tradescape site and I was a bit confused as to how exactly the trade is routed.

Can I choose where I want to route my trade, or does the broker (i.e. Tradescape) choose the destination for me? If I choose to route it myself, what are the main differences between routing via market maker and routing via ECN?

Finally, what market makers (or what characteristics of market makers) do you yourself prefer? Are there any differences between them?

Thanks again for your help! David

~~~Christopher's Response~~~

Hi David,

With a "live' level II feed on a live account you certainly have full control over where your order is routed, but the Tradescape demo simply executes you at the current high bid or low ask (level I).

If someone is just beginning their level II education I would strongly suggest that they just trade small shares and concentrate exclusively on the ISLD ECN. ISLD will give you fast executions and you don't need to know much about it to trade with it effectively. The only real drawback to ISLD is it's allowance of partial lot trades which is good for those trading small lots but bad for those who are not and get stuck with partial lots while trying to trade their full position in one transaction before the market moves away from them. Over time you should begin to learn the specific benefits and drawbacks to each ECN and the MM's in general.

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