Boo Hoo a trading slump on Wall Street. Article leaves out that CME full year trading volume was UP 10% in 2013. http://investor.cmegroup.com/investor-relations/releasedetail.cfm?ReleaseID=816874
it's over. As commissions declined, banks compensated with higher leverage, complexity and assuming more risk. more leverage and buffalo the customers is not a real business. plus the internet destroyed the information advantage the banks enjoyed. upgrades and downgrades will eventually disappear. the only real service banks provide is access to management.
"Executives have warned that lackluster markets could lead to year-over-year declines in fixed-income, commodities and currency trading revenue" The article is mainly about OTC (not exchange-based) non-equity trading by the big banks. These are the fields where the big banks f**d their "trading counterparties" for years by manipulating benchmarks and getting away with unfair pricing due to the intransparent design of these markets. If your brokerage statement shows you bought a stock for 22 but the high of the day is 20 you have an easy case to claim compensation. In an OTC market, there is no information about "the high of the day" etc. Maybe the banks' "counterparties" are finally wising up and reducing their exposure to this rigged game. Regulators certainly have wised up.
HFT churn. Volume surges at the open & close account for that, otherwise ES sits in five-tick chop ranges unbroken for two hours straight, day after week.
It's a cycle, like global warming and everything else. Maybe a longer cycle, but a cycle. There was this period of discovery where people were experimenting with trading via discount brokerages etc... Once those fees reached a low level and the critical mass came forward, it peaked. There aren't many new speculators coming into the game on the retail side - most will probably be from Asia from now on. The other thing that's more obvious with commodity volume rising and equity volume falling is the continued lies by corporations. I had grocery stocks in the early 2000's that got cut in half overnight when lies were discovered. That was the last straw for me. Now I only deal in indexes and broad based stuff, nearly all of which is regulated as commodities. People got tired of the risk with individual equities. Most of the public has a 401K now...with real money for an actual retirement in the account. You don't have any real percentage of your money in company X because if they lied about something, half your retirement is gone the next morning. Even if company X is in the S&P, your retirement acct doesn't really notice if you're in the index.