Nasdaq: An Embarrassment Of Embarrassments

“SOES BANDITS.” Market makers don’t think they’ll get anything in return from NASDAQ. In the past few years, for example, many market makers have complained bitterly about some small firms that make big money at the expense of big firms by jumping on price discrepancies through a mechanism called the Small Order Execution System. SOES was designed to allow small investors to trade directly on an electronic NASDAQ system, and the large firms thought it was abusive. Market makers wanted the “SOES bandits” banned, but the NASD had trouble adopting even modest reforms. (Bloomberg)



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