We have lost bullets an edge that many have profitably used to earn significant profits. It effects to some extent both traders and trading houses. However; this is not the first time that an edge is taken away. We used to have a much better than bullet edge in the past that is gone sometime ago. Ability to short on a downtick legally with no additional cost per se. In addition it was available to retail accounts. Edge was taken away just before decimalization. Remember "issue boxing" Long the stock in one account, usually cash account (dividend earning stock was preferable to offset part of borrowing costs in margin account) Short the stock in a margin account. No limit on trades per day no additional cost to open position. It was like a non expirable conversion with much less carrying costs. Back then conversion cost was 50$/1k plus carryover costs... But lets go further back for those who have been in this business as traders long enough to remember them good old days: The old SOES days. Enter the soes era, and and the immergence of a little known ability to trade called Island ECN. Those were some very lucrative arbing opportunities. Isld would cross MM's by 1/8 sometimes by 1/4... yes back in good old the fractions days. MM's were obliged to fill the SOES incoming order instantly to the limit of 1k displayed. You only need two hot keys isld and soes. Combine that with boxing and it was nice to say the least. Soes/Isld wasn't the only edge. MM's had a double liability exposure due to Selectnet requirements. You could hit the MM twice for the same amount even in only1lK was displayed you could get 2x1k fills. The technique became known and lost most of it's edge. But what killed it was the ASR. Actual Size Rule. and soes tier sizes. ASR gave the MM's the freedom to be liable for what ever they posted many times only for 100 shares. Well, 100 shares with ticket charges was not a viable scalping proposition, but still there were opportunities. counting seconds for SOES, first order from you is instant fill, next from the same trader was after a delay of 30 seconds. With selectnet the delay was 90 seconds for the MM to fill again, refresh or get out of the way. It was fairly easy to tell were the size was who was leaning and who was just spoofing. Spreads were fat money to make was way easier. ASR ruling killed most of it. Arb/spread Scalping 1-2k clips for eight's and quarters became very tough. It was absolutely great while it lasted. Many of us wouldn't be here today trading is it wasn't for the huge boost we got those early days. But "boxing" was still working nice, but was becoming very tough to move 1k sizes, and with the popularity of Isld and sub fractions..hehe isld was trading in 256's some b/d's allowed 512's to front run incoming orders. Isld was correctly named the partial monster. Remember the 17 share fills. Also hidden orders and rounding to closest 1/16 in the L2 montage was fun for the games played. Hehehe, remember the 17 share fills. Many were paying ticket commissions so a partial would cost another 15$ to get rid off. In semi liquid stocks we used to have so much fun. For the ones paying cent's per share we would hit isld's for 11 shares just to piss off competition. Hey, we learned the tricks from MM's hehehe. Anyway, with ASR in place and need to move at least 1k per clip. The move to to "slower" NYSE was a good one. Boxing was still in place. So it worked well. Some of us "specialized in NYSE few issues" due to boxing as we did with Naz stocks. Don/Bob Bright were and still are big into this specializing strategy. It's a good one. Here we only deal with one "traffic cop" we can move more size and trade his/her tricks. After a while the lightbulb come up and you can see the next print coming. Specialists are people. People are habitual beings. Each have their own way of treating size, gun stops, slingshots, delay short, match size at specific levels etc. But then, the "boxing issue" was outlawed. No more free ride. Trading Nyse we still had bullets and conversions. More expensive but did remain lucrative. The bigger edge in combination with those 2 was FRACTIONS. stock near or at roundy. 500x10 hehehe. Love it! Post bid 1k at 49-7/8, 1k 49 3/4, 2k at 19 9/16 superdot 2k mkt sell, 1k lmt sell 50, 1 k 49 1/2.. prints come on tape few k at 50 then the whole 50k is gone, (what else is new? hehe) next quote it's 49 1/2x50 10 x 500 we loved it. Tape prints 49 5/8, 49 1/2, 49 1/2 size.. and up we go close to 50 again. (convert this to decimals..) Typical move back then, now more of an exception... That was a nice edge to have. Fractions combined with bullets/conversions. Then the blow again to good old scalping eight's and quarters. decimalization. For many of us decimalization hurt that nice bread and butter strategy a great deal. However, decimalization made it a bit easier to short, but bullets were a must during the good down moves. Anyone remember SCH dropping from 48's to 42 with not a single uptick, or them wild rides in AOL before the specialist moved over to the IBM post? or that MU wild child, back when fractions were still in place.? So yes there are few edges that are lost due to structural changes in the trading business. Many remain. Open only, close only orders. Close only what an edge, before the 20 minute rule came into effect! Still a good edge. Pair trading, conversions may still be available. Enter e-mini markets, computerization, forex... there are still many others... So yes another edge maybe lost (won't be able to smack the bids down on bad news). Yes another tool of our arsenal has been taken away, but this is what trading is all about. Our job is to adapt, learn, become ever more efficient. I have no doubt that this shall pass too. Enjoyable, profitable trading, and good luck to all. Cheers