How embarrassing are these articless?

• SEC Keeps Wary Eye on Exchanges (WSJ)

• NYSE Data Violations Extend U.S. Exchanges’ Reputation Woes (Bloomberg)

• NYSE fined after some clients got early look at data (Reuters)

• NYSE Is Fined In Data Probe (WSJ) see chart below

As if we need more proof that we all would have been better off if the exchanges were still run as non profits . . .


NYSE Is Fined In Data Probe  

Source: WSJ

Category: Markets, Regulation

Please use the comments to demonstrate your own ignorance, unfamiliarity with empirical data and lack of respect for scientific knowledge. Be sure to create straw men and argue against things I have neither said nor implied. If you could repeat previously discredited memes or steer the conversation into irrelevant, off topic discussions, it would be appreciated. Lastly, kindly forgo all civility in your discourse . . . you are, after all, anonymous.

10 Responses to “NYSE Is Fined In Data Probe”

  1. GeorgeBurnsWasRight says:

    Good luck convincing the True Believers who want to privatize and deregulate everything.

  2. rd says:

    The real problem is the regulators. The exchanges should also be viewed as TBTF like the big banks and permitted to do whatever they need to to make their profits so that they can pay outrageous bonuses to executives.

  3. osbjmg says:

    I’ll read more into this, but I think it’s probably a grey area. It is common for exchanges to place much higher co-location fees for equipment that is physically closer to the feed. They sell banks space in their closest racks for orders of magnitude more rent. This is beneficial if you are doing HFT, but otherwise, I don’t see how the public feeds would be at a disadvantage unless they relied on this advantage of market timing.

  4. philipat says:

    70% of the volume is HFT!! Only the algos now have any confidence in the exchanges and the retail investor will not return until the perception of rigged markets is properly addressed. The regulators need to act either by taxing every quote or by requiring that every quote must remain valid for at least one second.

    ~~~

    BR: That 70% number is an errant and unproven data point, repeated mindlessly

  5. jpmist says:

    The embarrassing parts are the $5 million fine that’s less than 3% of annual revenue and that the NYSE deigned to receive the “settlement without admitting or denying the Commission’s findings.”

  6. ToNYC says:

    Island Exchange Datek/Jeff Citron had two servers and matched huge Nasdaq volume when the party was 1999 and the SOES first became bandits. Archipelago came together and made Instinet the old maid collecting old contracts for non-use, until the electrons swallowed the NYSE in the culturally reverse merger. Blowing air in a dead corpse is a waste of regulator time.

  7. Lyle says:

    Let me raise a question on HFT, if one buys intending to hold for one year or more the HFT which typically is at most a few cents or in many cases fractions of a cent will not be a big difference. Now if an individual day trades it is asking to have ones head handed to them on a silver platter. Further what if we went back to the old pieces of 8 quoting system where prices moved by 8 1/2 cents up or down. That would decrease the ability to manipulate small differences, but likley greatly decrease volume.

  8. ConscienceofaConservative says:

    Perhaps I’m nostalgic, but I think the NYSE gave up too much when it became a publicly traded organization and when it gave up the $2 brokers. Electronic trading is fine, however for profit exchanges and high frequency traders do not mix well and do not add liquidity to the market. All we have now are rigged markets that are prone to excessive volatility.

  9. PeterR says:

    “How embarrassing?”

    VERY!

    But not nearly as embarrassing as the success of this daring Taliban raid against a heavily fortified military base in Afghanistan which caused $200 million US dollars of damage.

    http://www.nytimes.com/2012/09/17/world/asia/green-on-blue-attacks-in-afghanistan-continue.html?hp

    Of further concern was the presence of Britain’s Prince Harry, as one of the helicopter pilots, who was not hurt. Read the details of the raid — scary that this was not stopped before they were able to breach the perimeter fencing IMO.

    Are we doing ANY good over there?

  10. philipat says:

    @BR: That 70% number is an errant and unproven data point, repeated mindlessly.

    I was just quoting the following sources:
    http://seekingalpha.com/article/288775-is-high-frequency-trading-causing-higher-volatility
    http://www.moneynews.com/MichaelCarr/carr-High-Frequency-Trading/2011/09/14/id/410924
    http://www.washingtonsblog.com/2012/04/84-of-all-stock-trades-are-by-high-frequency-computers-only-16-are-done-by-humans.html
    And many others.

    Whilst many of the sources quoted would appaer to be “Reputable”, if we truly do not know the correct number, that is very disturbing and perhaps there is a need to know. I fully agree that reliable data on this matter is needed, although I imagine that the exchanges might be “Embarassed” to fully cooperate because transparency and rigged markets don’t go well together.

    ~~~

    BR: Someone used it in a presentation, and it got bounced around repeatedly. ZERO DATA, repeated ad naueum. See this for the history: No, Average Stock Holding Period Is Not 11 Seconds . . .