raghu writes:
On Sat, Nov 7, 2009 at 10:26 AM, Marv Gandall <[email protected]> wrote:
Delaware Senator Ted Kaufman's observations that dark pools have risen from 1.5 to 12 percent of market trades in five years and that flash trading has "skyrocketed" to 70% of daily trading volume, if true, can't be easing those concerns.
http://www.businessinsider.com/sorry-goldmans-mega-profits-didnt-come-from-high-frequency-front-running-2009-7?mobile=1/ ------------------------------------------------------snip That said – these profits can’t add up to sufficient to explain Goldman’s trading profit.Interactive Brokers is (by far) the most electronic and lowest cost broking platform in the world. [...] Anyway if 10 percent of global stock volume provides 220 million dollars revenue per quarter then there is no way that a substantial proportion of Goldman’s trading profit can come from high frequency trading. The numbers do not work. When the New York Times quotes William Donaldson (a former CEO of the New York Stock Exchange) as that high frequency trading “is where all the money is getting made” they are quoting bunk – and they should know it. ========================================= How can anyone possibly determine what anyone's profits are on flash trading when it is a) still unclear how much of this activity takes place and b) how would you calculate the amount of excess profit gained in a split second? The estimated volume of flash trading does seem extraordinarily high, almost defying belief. The Delaware Senator says it accounts for 70% of all trades. SEC chair Mary Schapiro last month estimated "that lightning speed trading now represents more than 50% of trading volume." ("Goldman Sachs Defends Dark Pools, Short Selling", WSJ, October 27, 2009 http://online.wsj.com/article/SB125665689267210559.html?mod=rss_markets_main) _______________________________________________ pen-l mailing list [email protected] https://lists.csuchico.edu/mailman/listinfo/pen-l
