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View Diary: "79% of investors have no trust in the financial system." (154 comments)

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  •  The money HST makes, once went to market makers (0+ / 0-)

    both those who officially had that role on the NYSE as well as those who did so on their own.  Simply put, they would hold an inventory of shares and sell at the ask price and buy at the bid.

    HST and other computers have largely taken away these profits from market makers and given the bulk of the money to investors in the form of lower spreads.

    The people who most hate HST are those who previously made money as a market maker.

    As I write this comment, the difference between the bid and ask price on the SPY ($146.97/share) is one penny - a spread of less than one on hundredth of 1%.  Very different than the days when the minimum spread was $.25.

    The most important way to protect the environment is not to have more than one child.

    by nextstep on Wed Jan 16, 2013 at 10:12:31 AM PST

    [ Parent ]

    •  We're talking two different things. (0+ / 0-)

      There are the high-speed computerized trading systems that have largely replaced the old-time market makers and then there are the sophisticated high-speed trading programs designed to skim money from that system.  

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