Commentary

Tim Quast

Lava Cools As Citi Exits ECN Business

As dark pools move into the regulatory light, the real money is in aggregation, not in equity fragmentation.

Traders Poll

Do you expect more ECNs, like LavaFlow, or dark pools to close up due to regulatory pressure?

Yes

87%

No

13%

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Latest News

F-Squared Misled Investors in ETF-Linked Strategy, SEC Says

– F-Squared Investments Inc. agreed to pay $35 million over U.S. regulatory claims that it misled investors about the performance of a trading strategy used by exchange- traded funds.

Banks Turn to Plato for New European Equity Platform

– Six banks are developing a new not-for- profit platform to trade European equities called Plato Partnership Ltd.

Top 2014 Trends: FINRA Requires ATS to Report Trade Data

– Dark pools currently see 17 percent of trading volume in the $24 trillion U.S. stock market. In comparison, NYSE and its smaller offshoots account for 23.1 percent of volume, Nasdaq 19.7 percent and BATS 20 percent.

NYSE Proposed Market Overhaul to Start With Dark Pools, Less Fees

– The New York Stock Exchange is working to marshal Wall Street support for a plan that would overhaul features of the U.S. stock market that have drawn criticism from investors in the past year.

Barclays Dark Pool Case Judge Questions N.Y. on Victims’ Absence

– New York Attorney General Eric Schneiderman’s lawsuit accusing Barclays Plc of bilking customers to expand its dark pool was scrutinized by a judge for not naming specific victims of the alleged fraud.

A FinTech Blueprint for 2015 Traders

– Calling all capital markets professionals! Add more goals to your 2015 New Year's Resolutions: Meet new IT innovators and pay it forward.

STA Proposes Guidelines for SEC's Tick Size Pilot Program

– STA believes that one pilot test group strikes a proper balance between complexity and costs, with an efficient design that yields robust data.

NYSE's Grand Bargain Just Might Work: Matt Levine

– The exchange's plan to move trading away from dark pools won't be popular with everyone but it might be the future of market structure.

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Highlights from the Current Issue

Top 10 Trends That Rocked the Trading Floor

Traders examines the impact the top trends had on the past 12 months, and what role they may play in the coming year. A different one will appear each day, Today, the growth of commissions for the first time in recent memory is featured.

Regulation SCI's Hidden Costs May Cause Sticker Shock

How much are institutional investors willing to pay for improved market resiliency and fewer IT crashes? They're about to find out and they may want to be sitting down when they ask for estimates.

Goldman, BoA and Morgan Stanley Top N American Equity Derivative Brokers

Goldman Sachs, Bank of America Merrill Lynch and Morgan Stanley have all maintained their top 3 positions and rankings as the leading brokers of flow equity derivatives to North American institutional investors.

Reputational Risk RIP

Today, a $5 billion fine is the cost of doing business. How can any Wall Street firm take risk seriously?

KCG Said to Seek at Least $300 Million for HotSpot Unit

KCG Holdings Inc., the trading firm formed in the aftermath of Knight Capital Group Inc.'s near collapse, is seeking at least $300 million for its currencies unit, people with knowledge of the matter said.

PDQ ATS Announces New Auction with Up to One Second Delay

PDQ ATS, the venue that helps the buyside amass liquidity by building an order book first and then holding an auction, is about to introduce its second auction model.

FXCM Launches New Pricing Model Offering Raw Forex Spreads

FXCM, a global online provider of foreign exchange trading and related services, announced that its U.S. subsidiary FXCM U.S. has introduced a new retail FX pricing model. FXCM U.S. platforms will now display raw spreads and mark-ups previously included in the spread will be separately displayed as a commission.

BOOK REVIEW: 'Flash Boys' Burns HFT

Traders' reviews the controversial Michael Lewis tome 'Flash Boys' and how it has changed the way Americans think about high-frequency trading "if they even thought about it all" and its impact that may be seen in new regulations.

The Long Compliance Race

In an industry dominated by speed, where short-term success is dependent on decisions made faster than the blink of an eye, guest commentator Mark Knoll said that getting traders to focus on the long-term impact of regulatory changes is like trying to get a world class sprinter to think like a marathon runner.

CLEARING: CME's Sprague Warns About Failure to Settle Clearing Impasse

Traders spoke to Suzanne Sprague, executive director of collateral and risk for CME Clearing about the impasse, how to resolve it, and what it means for the clearing market.

Goldman Sachs Prohibits Bankers from Buying Stocks

In a move designed to address potential conflicts of interest and clarify an opaque policy on employee ownership of stock, Goldman Sachs is making a move to protect its employees and itself.

Will Illiquid Stocks Spell Doom for the Trade-At Rule?

Will the illiquidity of small- cap stocks and others targeted for promotion by the JOBS Act make execution of a "trade-at" rule more difficult?

HFT Hype Should Give Way to Serious Market Discussion, Experts Say

With the immediate furor over Michael Lewis's book, Flash Boys, finally dying down, many market players are hoping the receding hype gives way to a discussion of the real problems and possible solutions to some of the issues the book brought up - namely market structure.

ALGO UPDATE: Neonet Readies Algos for Europe; U.S. to Follow

Swedish agency-broker Neonet has a simple business strategy – offer its algorithms and electronic trading solutions first to its native European equity trading clients, and then cross the Atlantic and enter the U.S. equity markets.

ITG Announces POSIT 3.0 Algorithm Rollout

ITG's newest dark pool algorithm, POSIT 3.0, is now available to all its U.S. clients, and sometime next year to its European customers.

The Marketplace Awaits Regulation SCI

Davis Polk's Annette Nazareth and Jeffrey Dinwoodie review Reg SCI, its implications, costs and how the rulemaking may be an interesting window into the SEC's future steps in market structure.

Watch the Fiscal Rocks

Modern Network's Tim Quast discusses Michael Lewis's cage-rattling bestseller about high-speed trading, "Flash Boys," and how it left one thing out. Quast notes Lewis didn't say why exchanges pay fast traders. The answer spotlights the importance of getting right whatever corrective market-structure measures may come.

PDQ ATS Announces New Auction with Up to One Second Delay

PDQ ATS, the venue that helps the buyside amass liquidity by building an order book first and then holding an auction, is about to introduce its second auction model.

Will Illiquid Stocks Spell Doom for the Trade-At Rule?

Will the illiquidity of small- cap stocks and others targeted for promotion by the JOBS Act make execution of a "trade-at" rule more difficult?

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