The new hybrid system and scalping equities

right now it makes little difference, next month when DOTN goes into full implementation and the INET, BRUT SMON merger is finished... then you´ll be able to get a liquidity rebate on NYSE stocks.

 

I´ve been wondering that myself... why have a specialist in a stock that trades 500k per day, if all trades under 1MM requiere no specialist...

 

Personally, I think thin stocks wont be as affected as thicker stocks but we'll see.

 

Example: On a stock quoted 19.75 asked gets a large buy order that would require going to 19.80 to completely fill. Under the current system, 1 large print would happen at 19.80. If you had a sell order at 19.78, you'd get 19.80. This is known as price improvement and is one of the big advantages of trading NYSE stocks.

Under the new system, that order would "walk the book", filling each sell order at the price it is resting at, ie. no price improvement.

It does appear that they will differentiate between electronic and manual orders in that electronic orders walk the book and manual sweep. How we'll be able to tell the difference is yet to be seen.

 

The question is where is the SEC with all of these mergers going on. Seems like we are moving towards a duopoly (NASDAQ vs. NYSE), and this noncompetitive environment is forcing fees higher. That's the real problem here....

 

isn't that disadvantagous to the big order as he may have to pay more and step up more to buy?

 

Maybe, maybe not. Under the old system me and many other traders were offering shares for him to take.

Under the new system we might not be there anymore and he might end up "walking" further than he would have "swept".

Markets need liquidity. If this change decreases liquidity, then it could be a bad thing.

 

not really bro. It isnt up to the SEC to regulate this, the market regulates itself.
How? well As this duopoly hasn´t even started to be enforced, there´s already another 800 pound gorilla that wants a piece of the action. The CBOT is going to create a stock exchange to compite with the NYSE/NASDAQ... Also, I wouldn´t expect th Deusche Borse to just sit on their ass while the north americans take over the world...

 

dream on dude-----
hope you have recruited enough people on ET to help out cause
you are the typical trader this thing will eliminate- and make no mistake- your tape reading skills will be worthless in 3 weeks

 

what's your perspective on thinner stocks and the new hybrid system?