Dark pools: Quote:‘Dark Pools’ Draw More Tr
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Posted On: 08/19/2019 8:54:55 AM
Dark pools:
Quote:‘Dark Pools’ Draw More Trading Amid Low Volatility
Share of U.S. stock trades executed on off-exchange trading venues hits highest level in more than a year
Dark pools have periodically stirred controversy. The SEC last year approved new rules forcing dark pools to be more transparent about how they operate.PHOTO: ANDREW HARNIK/ASSOCIATED PRESS
By Alexander Osipovich
May 3, 2019 8:35 am ET
The calm markets of recent months have meant more trades are getting done in the dark.
Dark pools—private trading platforms, typically geared toward big investors—have enjoyed growing market share this year. The share of U.S. stock trades executed on dark pools and other off-exchange trading venues rose to 38.6% in April, the highest level in more than a year, according to research firm Tabb Group, and up from 34.7% in December.
When markets are volatile, traders flock to stock exchanges, where orders to buy or sell are publicly displayed. They are in a greater hurry to buy or sell shares before prices move in an unwanted direction. Broadcasting orders to everyone else in the marketplace helps draw interest, helping to ensure that trades get done quickly.
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But some investors, especially hedge funds or other big players looking to amass or dump large quantities of shares, don’t want to tip off the broader marketplace about their intentions, for fear that it will result in them getting a worse price.
Such players may seek to execute their trades on dark pools. These trading platforms—which are formally called automated trading systems—keep orders hidden. There are more than 30 dark pools for stocks trading, with the largest run by banks such as UBS Group AG, Credit Suisse Group AG and JPMorgan Chase & Co.
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Dark pools have periodically stirred controversy. Since 2011, the Securities and Exchange Commission and New York Attorney General have collected more than $340 million from dark pool operators to settle various allegations, including false marketing and exploiting confidential customer data for their own trading purposes.
Last year, the SEC approved new rules forcing dark pools to be more transparent about how they operate. But they are still subject to looser regulation than stock exchanges.
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https://www.wsj.com/articles/dark-pools-draw-...1556886916
Quote:‘Dark Pools’ Draw More Trading Amid Low Volatility
Share of U.S. stock trades executed on off-exchange trading venues hits highest level in more than a year
Dark pools have periodically stirred controversy. The SEC last year approved new rules forcing dark pools to be more transparent about how they operate.PHOTO: ANDREW HARNIK/ASSOCIATED PRESS
By Alexander Osipovich
May 3, 2019 8:35 am ET
The calm markets of recent months have meant more trades are getting done in the dark.
Dark pools—private trading platforms, typically geared toward big investors—have enjoyed growing market share this year. The share of U.S. stock trades executed on dark pools and other off-exchange trading venues rose to 38.6% in April, the highest level in more than a year, according to research firm Tabb Group, and up from 34.7% in December.
When markets are volatile, traders flock to stock exchanges, where orders to buy or sell are publicly displayed. They are in a greater hurry to buy or sell shares before prices move in an unwanted direction. Broadcasting orders to everyone else in the marketplace helps draw interest, helping to ensure that trades get done quickly.
..
...
But some investors, especially hedge funds or other big players looking to amass or dump large quantities of shares, don’t want to tip off the broader marketplace about their intentions, for fear that it will result in them getting a worse price.
Such players may seek to execute their trades on dark pools. These trading platforms—which are formally called automated trading systems—keep orders hidden. There are more than 30 dark pools for stocks trading, with the largest run by banks such as UBS Group AG, Credit Suisse Group AG and JPMorgan Chase & Co.
..
..
Dark pools have periodically stirred controversy. Since 2011, the Securities and Exchange Commission and New York Attorney General have collected more than $340 million from dark pool operators to settle various allegations, including false marketing and exploiting confidential customer data for their own trading purposes.
Last year, the SEC approved new rules forcing dark pools to be more transparent about how they operate. But they are still subject to looser regulation than stock exchanges.
..
...
https://www.wsj.com/articles/dark-pools-draw-...1556886916
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