David Drake
Traders Magazine Online News

Why Bitcoin Continues to Rule the Crypto Market Despite its High Volatility

So, how does the highest profile cryptocurrency manage to stay on top of the market despite threats from regulators, hackers and even market pundits.

Traders Poll

Do you think the recently approved SEC access fee pilot will demonstrate rebates negatively affect routing decisions and best ex?

Free Site Registration

February 1, 2011

Wedbush Brings Co-Lo to the Buyside

By Peter Chapman

Wedbush Securities is offering money managers fast access into Nasdaq's three stock exchanges and beyond. The move is an attempt to eliminate the speed advantage high-frequency traders have over the traditional buyside.

"Institutions now have the same capabilities and technological advantages of high-frequency firms," said Kevin Beadles, Wedbush's director of equity trading. To make that possible, Wedbush has taken two steps. It has dropped a server into the data center in Carteret, N.J., that houses Nasdaq's order books. And it has entered into an agreement with Bloomberg, so that Wedbush customers using Bloomberg's EMS/OMS can run their orders directly into Wedbush's setup at Carteret.

Wedbush's server will take in every message from the three Nasdaq exchanges and create a virtual order book in memory. The buyside user can then execute trades off of those order books. That is how high-frequency trading shops operate, Beadles said. Orders not executed on Nasdaq will then be routed by Nasdaq to other marketplaces.

By eliminating any speed advantage HFTs have over traditional fund managers, these buysiders will be able to capture more volume, Beadles explained. In the race to hit a bid or lift an offer, the buyside is often one step behind the HFTs due to latency. Orders from the buyside must often travel over greater distances and through more "pipes" to get to the exchanges, he said.


(c) 2011 Traders Magazine and SourceMedia, Inc. All Rights Reserved.