Let's assume that institutions or traders at institutions are dumb. Being dumb, they don't know how to trade. If they do trade publicly on an exchange, they lose money. In this zero sum game of trading, some money goes to retail traders. To avoid losing money to retail traders, institutions decide to trade directly with themselves. In such a way, they bypass the exchanges where retail traders are waiting to pounce on them. So in the interest of retail traders and, more importantly, for the sake of market transparency, let's abolish dark pools. My challenge to institutional traders: If you know how to trade, come to the exchanges where the playing field is level and transparency is assured by a third party like Better Business Bureau (no more GS trick of front running/flash trading/co-location of servers bs), don't hide in your dark pools, come out into the open.
Butt Plug Trader: What tickers did you get run over in, I will make sure you get the call before a print is going up in the hole next time! Gimme a break.
End dark pools. Why there's even a discussion about that? Markets have to be TRANSPARENT. There should not be price discovery at all outside of the "public pools". All participants should be able to see all offers at the same time. Not doing that means, IMHO, that the US exchanges/Us investment system(s) are decaying and will be surpassed in the future by some other country that offers a leveled playing field
Hey moron, I will be happy to trade against you. I will let you know that the thing up your butt is not a plug, but a huge stick.
Seriously? What happens when an investor takes a moderate size in a small growing company, makes the correct call and then wants to take some profits based on the predetermined exit strategy? How does he/she get out without jepordizing the company? It goes both ways - Dark Pools can protect the little guy/s as much as help the big guy/girls.
Does the dark pool initiate a new "long" position when it buys the shares from this investor or does it cover a 'short" position that was initiated based on knowledge of the impending sale from the investor?