> world-class exchange rooted in alignment Does this actually mean something specific?
Enron 2.0
SEC approves Texas Stock Exchange, first new US integrated exchange in decades
291–300 of 493 posts
Re: SEC approves Texas Stock Exchange, first new US integrated exchange in decades
#292Earlier quoted context omitted.
There is no reason why shares should be bought on sold in time frames far too short for anything to have meaningfully changed about the companies or market conditions.
The issue isn't that there's a lot of change coming from inside the markets, it's that there's a lot of change coming from outside the market, and it's all interconnected.
In a millionth of a second? This a rationalization for something that is only being done because it can be done.
Re: SEC approves Texas Stock Exchange, first new US integrated exchange in decades
#293The Miami stock exchange (MIAX) has their matching engines colocated in Equinix's NY4 data center in Secaucus NJ, much like many other exchanges. I would not be surprised if TXSE does the same. Many trading firms already have their trading engines in that data center and I would assume TXSE would want quick access to that order flow and this might be easier if they are in NY4. Of course, they may want to have their c…
They have job postings that include NYC-based network operations engineers. https://www.txse.com/meet-the-team#careers
Re: SEC approves Texas Stock Exchange, first new US integrated exchange in decades
#294Earlier quoted context omitted.
There were already two exchanges. I don't think this changes much.
More than that, London and Tokyo both have well known exchanges, and large US companies are often listed on both of those as well. If you tried to tell me that no other country has an exchange I'd call you a lair without bothering to fact check you. (My impression is New York, London, and Tokyo are the big ones that matter in the world and everything else is a me too - but in their niche/country they may still be a b…
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Re: SEC approves Texas Stock Exchange, first new US integrated exchange in decades
#295Earlier quoted context omitted.
Reg NMS’s Order Protection Rule (Rule 611) says you can’t trade through protected NBBO quotes, outside a few narrow exceptions. That’s the letter of the law. The practical effect isn’t just a bit of latency. It rewires incentives. With 611 in place, the question for latency-sensitive firms becomes: what HFT tactics can I run that are 611-compatible? Without 611, the question would be: what HFT tactics actually add va…
There is no reason why shares should be bought on sold in time frames far too short for anything to have meaningfully changed about the companies or market conditions.
So, you want everyone to trade only daily or weekly or quarterly?
Re: SEC approves Texas Stock Exchange, first new US integrated exchange in decades
#296What is the need for another stock exchange? I hate that I am thinking like this but this is just going to be politicized heavily and companies like Tesla and coke will just switch to that exchange causing further more rift in our society. Where one company lists will become a problem for companies and they cannot be neutral politically even if they really are
I propose a global stock exchange for the whole planet. Heck, why stop here, make it for the whole galaxy in case Elon Musks manages to land on Mars.
Re: SEC approves Texas Stock Exchange, first new US integrated exchange in decades
#297Earlier quoted context omitted.
IEX tried this to much fanfare. Turns out most participants don’t particularly care about that as a motivating factor.
That’s what always surprises me when folks bring this up. Nobody in the market cares. Institutional investor experience some of the lowest trading cost in history. These complaints are most often coming from retail traders where again I don’t follow the argument. Instead of some guy on the floor picking up dollars with have machines picking up pennies. This is a win for everyone.
Nobody in the market cares because everyone in the market are cheaters. There is a huge untapped potential of people outside the current market that do not participate because they know the market is rigged against them.
A fair market could be huge, but the trick is keeping it fair. It used to be more fair, and we used to have a healthier economy because of it.
It’s not like most of the unfairness in the current market couldn’t be dealt with, probably with laws already on the books. Most HFT strategies are not only blatantly dishonest but also clearly illegal. The government looks the other way though, because corruption.
Re: SEC approves Texas Stock Exchange, first new US integrated exchange in decades
#298Earlier quoted context omitted.
> Perhaps Texas could use a different trading model that doesn't require ultra high speed trading. What would that look like? Periodic auctions? Certainly it could be done, I'm just trying to understand what problem might be solved, and whether the solution would be effective. For example, even with the opening and closing auctions we have today, there can be an advantage to getting your order accepted right before t…
One option is to add a random delay to every trade, thus making high speed arbitrage substantially more difficult.
I suspect that randomness of some sort is the only way. Without that, whatever the rules of the game, there is a way to somehow get a slim advantage. You can make the advantage small and the costs to try to gain it large, such that it isn’t cost effective to try, but as we’ve seen with HFT, it’s amazing how much people will spend to pick up pennies. Even a tiny gain, exploited frequently enough can be quite profitable.
Re: SEC approves Texas Stock Exchange, first new US integrated exchange in decades
#299Earlier quoted context omitted.
The issue isn't that there's a lot of change coming from inside the markets, it's that there's a lot of change coming from outside the market, and it's all interconnected.
In a millionth of a second? This a rationalization for something that is only being done because it can be done.
When I press the buy and sell button, I want the transaction to happen as quickly as possible. So does everyone else.
My millionth of a second is different than yours, and everyone else’s.
It is no different than buying or selling anything else. And there is no loss from the additional liquidity, you can easily set a limit at which you want to buy or sell.
Re: SEC approves Texas Stock Exchange, first new US integrated exchange in decades
#300Earlier quoted context omitted.
I'd say IEX has done remarkably well - it's not likely to displace NASDAQ or NYSE but it has solidified its place as the #3 US exchange by any reasonable measure. If TXSE achieves comparable market share I'd call that a wild success. You're not wrong to say that most participants don't care about what IEX offers, but enough do to make a meaningful dent in trading volume.
It’s definitely not 3rd place. That’s cboe and it’s not close. It’s hanging around with ~2% of the trade volume. https://www.cboe.com/us/equities/market_statistics/ I don’t know if that is “remarkably well” but it certainly isn’t some market paradigm shift. If you were to tell me in 10 years the Texas exchange would have 2% of the market I’d believe you. But I’d still not be terribly impressed.
You're right, my view is way out of date. I didn't realize CBOE had grown so much in straight equities trading. IEX is the best of the rest, but it's NYSE, NASDAQ and (to my surprise) CBOE as the clear top 3.