I found that options traders - the Amex was mainly an options exchange - routinely conspired to keep as wide as possible the spreads between the prices investors paid and the prices floor traders paid for the same securities.
Sentiment: NEGATIVE
High-frequency traders are firms all around the world. They're massive investments.
The options and futures traded on exchanges are derivatives contracts.
We built a market at IEX that does not sell certain types of technology advantages to high-frequency traders, and as a result, the high-frequency traders that didn't rely on buying those advantages trade on IEX.
On the New York Stock Exchange, all buy and sell orders are routed through a single 'specialist,' guaranteeing that most small trades can be matched directly. But most larger trades are delivered to the specialist on the floor of the exchange by human brokers, a system that big investors view as increasingly inefficient.
Financial institutions like to call what they do trading. Let's be honest. It's not trading; it's betting.
High-frequency traders are firms all around the world. They're massive investments. And there is an incredible race for speed now. People are paying hundreds of millions of dollars to shave milliseconds off.
The average trade of an individual is in the thousands of shares, whereas the institutional trade can be in the millions of shares. Clearly, the bigger the order, the bigger the move in the stock.
I believe in libertarian options because they allow an interesting management of the capital and are based on co-operation, reciprocity, contract, federation.
When I was in the private sector, one characteristic that differentiated the best entrepreneurs from the others was that they were not in it for the stock options, but for a mission - to deliver something that was helpful... Every entrepreneurial journey, it turns out, is like this.
Electronic communications networks match trades between investors directly, without using a market maker or specialist as an intermediary.