will the retail volume come back in this generation. we all saw how the exchanges constantly re rigged the game any time anybody but their shareholders made a profit. it is rather annoying. You develop an edge... if its real they find a way to transfer it to someone else. I watched a few of my edges regulated away or we watched the exchanges change their practices to take it away. and while it did not effect me at the time... this b.s. about having 25g in your account. prevents a lot of would be traders from getting started.
I think you are saying thank goodness the BS is out there. Or are you saying that even more rank beginners should lose their money to the market. Or are you saying that there would be hundreds of more profitable would be traders except for this nonsense. I have empathy for the little traders and try to help them. One problem is they often don't understand the significance of what is said and in particular, what is not said. It took me a long time, but I guess I am a bit slow ....
If you go back... you see that the internet stock trading boom stung the market makers for so much money they backed away from those markets and then the internet stocks really took off. The large firms then lobbied the sec to stop the public from trading so they would never get stung like that again. The SEC pretended this was to protect the consumer... when it was really to stop strong trends from wiping out market maker profits. Ironically, the market makers lost their jobs anyway as the public became less involved. I think it was a terrible rule on many levels. Who the hell is the state to tell someone he can't trade his money.
Here is some detail on what "they" probably have some algo based on. http://fxtrade.oanda.com/analysis/forex-order-book The small player always has a chance to make it but the many losers will always feed the few winners, just the way it has to be. Just like 6 of the Waltons own more than the bottom 30% of the US. The bottom 30% all go to walmart though don't they
The average human can react to something in ~200ms. i successfully aggressively scalped estoxx from LA for 4 years with an average ping time of ~300ms so adding that to my reaction time makes a minimum of 500ms and it was no problem whatsoever. until this new algo that just took over the market a few months ago that is. anyways, i would kill for this new rule and any former scalper who thinks otherwise well then fine, stay on the sidelines. i wont be holding my breath this law gets passed though.
What would be best for the exchanges, in the long run, would be to assure as level a playing field as possible for all participants. Ideally, all orders would take exactly the same time to reach the exchange and all confirmations would take exactly the same time to be received. No peeking. No internalizing of orders by brokers. Brokers must always transmit a client's order ahead of their own. Every participant has exactly the same view of the resting orders as every other participant. It's a pipe dream though. This is Wall Street, not Sunday School.
the reasons why it will never going to happens is been described many times here..it's all about profits,not fairness..once there no more IPO's(cause of higher taxes(and following outsourcing) thanks to Billy C and whom after him... oval office **r).. exchanges gotta sell something as profits fall. so they became a bit creative..
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Yes, I understand you, and I also think it is possible, it is probably already done. But as we know from emg, already 90 % of traders just lose. So for the majority it is just a good excuse or rationalization why they lose.
A really fair implementation would be to collect a fine for pulling orders after a minimum of violations and redistribute said monies to whoever had the inside bid/ask orders resting.