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Discussion in 'Educational Resources' started by pragmatic-trader, Aug 25, 2020.

  1. LOL, of course not. Dark liquidity is detrimental to price discovery and market transparency, that's why Europe is trying to get rid of it. However, dark pools do benefit (or used to benefit, as they are being gamed a lot now too, as I described) large traders/funds who need to execute large orders without moving the stock.

    PS. It really depends on the definition of the mankind :D
     
    #31     Aug 25, 2020
    pragmatic-trader likes this.
  2. Precisely
     
    #32     Aug 25, 2020
  3. Tradex

    Tradex

    The ONLY goal of dark pools and HFT trading is to take money from the public, not to provide ANY kind of benefit whatsoever to Joe and Jane Doe or the large traders.
     
    Last edited: Aug 25, 2020
    #33     Aug 25, 2020
    comagnum likes this.
  4. Of course all professional market participants live to take money from "the public", whoever that may be - retail traders, large pension funds etc. All of the song and dance about "we provide liquidity", "we offer risk transfer" is just bullshit. That's what short-term trading is all about, it's a zero-sum game, regardless of what your broker wants you to think. Dark pools exist so large players can trade with less impact - as a result, Joe Daytrader will not see that flow and be able to scalp. HFT is there to provide Robin Hood and other members of the public with liquidity when they need it the least, pull it when they need it the most and negatively select them as much as possible. Why would you expect anything else?

    Dude, you have some bizarre misconceptions about the world if you think people do things to provide "a benefit".
     
    #34     Aug 25, 2020
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    Last edited: Aug 25, 2020
    #35     Aug 25, 2020
  6. I can't believe you are even asking this...
     
    #36     Aug 25, 2020
  7. Apparently you did not believe that dark pools mainly exist so large players can trade stock with less price impact and said that I am clueless. So I asked the question and you refused to answer. I rest my case.
     
    #37     Aug 25, 2020
    pragmatic-trader likes this.
  8. Tradex

    Tradex

    That's the idea they have been trying to sell us since day one.

    It's a big fat lie.

    Same thing for the HFT guys: "We provide "liquidity" to the market!"

    Bullshit, they create fake liquidity as orders are created and cancelled in nanoseconds. And the traders are the ones paying the tab, one penny at a time.

    Pure, legal robbery.
     
    Last edited: Aug 25, 2020
    #38     Aug 25, 2020
  9. Do you trade in dark pools? I rest my case.


    You! LARGE PLAYER :)
     
    #39     Aug 25, 2020
  10. Misguided. BBO spreads are way, way, way down since the advent of HFT. And the liquidity is most certainly not fake, you can lift their offer whenever you want. If you think otherwise that's conspiracy nonsense created by salespeople with an axe to grind like the IEX founder. Think about where you're getting your information from. Have you worked in the industry and do you really know what the strats are?

    The industry is close to perfectly competitive now with margins way down. Gone are the '08 PnL consistency. Only way to be consistent nowadays is to have multiple strats on multiple markets and get diversification benefits.

    HFT also frees up human capital since momentum and correlation alpha get traded out of the market. Now one computer program can replace a hundred delta one scalpers. It's identical to automation in any other industry. Luddites and people on the sidelines will endlessly cry and whinge just because they can't keep up and are made redundant. In the end it's just injured egos more than anything
     
    #40     Aug 25, 2020
    Nobert and qlai like this.