nasdaq vs nyse(important...too me at least)

Discussion in 'Trading' started by nwbprop, Oct 31, 2002.

  1. I'm not saying I'm a big fan Dick Grasso (what political office is he eyeing, anyway?) -- BUT, I think decimalization is a vain frivolity and couldn't have come at a worse time (not that any time was a good time).
    #31     Nov 2, 2002
  2. Tea


    All that decimalization offers is the possibility of narrower spreads, not the certainty.

    On Nasdaq it seems to be working, on the NYSE with their black box bid-ask system they are playing games that make sequential limit orders unlikely. They want you to submit market orders so they can maintain an unjustly wide spread.

    Besides that, I was never good at fractions.
    #32     Nov 2, 2002
  3. :D

    spreadless markets are like cars without springs and shock absorbers (uncomfortable, prone to loss of control on rough patches, impedes optimal performance, hurts the backside, etc.) to wit, nasdaq.

    there is, of course, the possibility of overdoing it. Old, worn out suspensions are equally prohibitive. The good thing is that if markets are left alone, they will attract and repell participants as necessary to induce a working balance.

    (I'm thinking just now about how racers tune their suspension to track and weather conditions, and whatever else matters).

    decimals have no soul.
    #33     Nov 2, 2002
  4. Tea


    What do the NYSE specialists do when a stock hits a bump - they stop trading in the stock. Some shock absorber.

    Eventually I think when markets become all electronic, large financial institutions will play market maker for a fixed fee depending upon the volume/liquidity of a stock. They can handle the risk management aspect of being a market maker better than individuals or smaller institutions.
    #34     Nov 2, 2002
  5. fixed fees wouldn't be good for markets. who pays them? Why? It amounts to a subsidy to trade, and subsidies taint markets.

    marketmakers take risks according to their edge. the pits have it pretty well worked out.

    I wouldn't put "halts" in the category of "bumps." A halt is like lifting a drawbridge to let an unusually large vessel pass, or detouring for a serious accident.

    How about these analogies!
    #35     Nov 2, 2002
  6. Tea


    Right now traders pay a variable fee per transaction called the spread.

    Instead of having a spread, you would pay a fixed fee per transaction, kind of like the SEC fees.

    Would this be considered a subsidy to trade? No, its a fee for the market maker to provide liquidity, just as the spread is a fee that goes to market makers currently.

    :D I have to go, you can have the last word, chasin.
    #36     Nov 2, 2002
  7. the market sets the spread. the market knows best.

    have a nice weekend.
    #37     Nov 2, 2002
  8. think Dima screaming at William in this case lol.
    #38     Nov 7, 2002