Dark Pools Quotes

“The morning of the offering, NYSE officials on the floor passed out silver bells emblazoned with NYX on the handle. Traders were told to ring them with abandon at the open. While they were billed as a shiny memento, their true purpose—to drown out the expected chorus of boos and catcalls from disaffected specialists—spoke volumes about the turmoil behind the scenes.”
― Scott Patterson, Dark Pools: The Rise of the Machine Traders and the Rigging of the U.S. Stock Market

“The Algo Wars were leaving a path of destruction in their wake. “HFT algos reduce the value of resting orders and increase the value of how fast orders can be placed and cancelled,” wrote Nanex researcher Eric Hunsader. “This results in the illusion of liquidity. We can’t understand why this is allowed to continue, because at the core, it is pure manipulation.”
― Scott Patterson, Dark Pools: The Rise of the Machine Traders and the Rigging of the U.S. Stock Market

“This has the effect of forcing marketplaces to compete in latency. You end up with exactly what you have now—people spending millions (billions?) of dollars to save milliseconds (microseconds soon?). What an expensive and needless mess. You could probably find a cure for cancer in a year if you just reassigned all the smart people who are now working on this artificially created and otherwise useless problem.”
― Scott Patterson, Dark Pools: The rise of A.I. trading machines and the looming threat to Wall Street

“He found the race to zero deeply troubling. “People (machines) now have to race to be the first person at a fixed price level,” he wrote in a July 2011 e-mail. “This has the effect of forcing marketplaces to compete in latency. You end up with exactly what you have now—people spending millions (billions?) of dollars to save milliseconds (microseconds soon?). What an expensive and needless mess. You could probably find a cure for cancer in a year if you just reassigned all the smart people who are now working on this artificially created and otherwise useless problem.”
― Scott Patterson, Dark Pools: The Rise of the Machine Traders and the Rigging of the U.S. Stock Market

“It was so complex. The number of destinations for trading stocks was maddening. There were four public exchanges: the NYSE, Nasdaq, Direct Edge, and BATS (the latter two, which specialized in high-speed trading, appeared on the scene in 2005 and 2006, respectively). Inside each of those exchanges were various other destinations. The NYSE had NYSE Arca, NYSE Amex, NYSE Euronext, and NYSE Alternext. Nasdaq had three markets. BATS had two. Direct Edge had EDGA, which had no “maker-taker” system, and EDGX, which did.”
― Scott Patterson, Dark Pools: The Rise of the Machine Traders and the Rigging of the U.S. Stock Market

“At the end of World War II, the average holding period for a stock was four years. By 2000, it was eight months. By 2008, it was two months. And by 2011 it was twenty-two seconds,”
― Scott Patterson, Dark Pools: The Rise of the Machine Traders and the Rigging of the U.S. Stock Market

“whisper of a smile”
― Scott Patterson, Dark Pools: The Rise of the Machine Traders and the Rigging of the U.S. Stock Market

“At a cost of up to $10,000 per pod per month, it was a highly lucrative business for the NYSE. How the setup fit in with the notion that electronic trading created a level playing field for all investors was another question.”
― Scott Patterson, Dark Pools: The Rise of the Machine Traders and the Rigging of the U.S. Stock Market

“What an expensive and needless mess. You could probably find a cure for cancer in a year if you just reassigned all the smart people who are now working on this artificially created and otherwise useless problem.”
― Scott Patterson, Dark Pools: The Rise of the Machine Traders and the Rigging of the U.S. Stock Market

“Just as quickly, as stocks bobbed and weaved, those orders were canceled and resubmitted at different price points—at different exchanges and dozens of other trading venues, such as dark pools (incredibly, a staggering 90 percent or more of all orders placed into the stock market were canceled).”
― Scott Patterson, Dark Pools: The Rise of the Machine Traders and the Rigging of the U.S. Stock Market

“At the end of World War II, the average holding period for a stock was four years. By 2000, it was eight months. By 2008, it was two months. And by 2011 it was twenty-two seconds, at least according to one professor’s estimates. One founder of a prominent high-frequency trading outfit once claimed his firm’s average holding period was a mere eleven seconds.”
― Scott Patterson, Dark Pools: The Rise of the Machine Traders and the Rigging of the U.S. Stock Market