Cuban takes another jab at high-frequency trading

Mark Cuban, renowned for his success founding and funding start-ups, told his followers that high-frequency traders are dominating the stock market this week. In particular, he warns the computer-based rapid trading poses risks for investors, who can’t act as fast as a machine. “They see what’s happening and make bets on it before you do,” Cuban wrote on Cyber Dust, an ephemeral messaging app. “So be careful in this market.” (CNBC)


10 Things People Don’t Get About Dark Pools

Dark Pools are electronic Alternative Trading Systems, very similar to stock exchanges where trades can be matched. The big difference of course is that the orders are dark, meaning that the size and price of the orders are not revealed to other participants. This limits the amount of interaction because the participants don’t know when to move their price up or down to find the contra side of their trade or when the contra side may be present in the pool. These pools are mostly used by sophisticated professional traders. (CNBC)


Man Vs. Machine: How the Crash of ’87 Gave Birth To High-Frequency Trading

A small coterie of savvy investors smelled an opportunity. Since the SOES trades were automated, meaning they received almost instant execution, and were given priority ahead of the rest of the market, a fast-moving trader could move in and out of stocks using SOES at a far-more rapid clip than large investors, generating big profits. (CNBC)