A High Frequency Trader's Apology, Pt 2

Re:A High Frequency Trader's Apology, Pt 2 by moe on Thursday April 26, 2012 @08:04PM (#3896764)

There are also mandatory fill rates - i.e., if you don't fill at least 30% (or some such fraction) of the orders that are flashed to you, you get kicked out of the ELP program.

When I read about these things it reminds me of when I was working for a gambling site a few years back. Arbitrary rules, designed to maximize profit for the bank.

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Re:A High Frequency Trader's Apology, Pt 2 by yummyfajitas on Thursday April 26, 2012 @08:23PM (#3896808)

The fill rate is not an arbitrary rule. The goal of ELP is to allow more orders to be filled on Direct Edge (i.e., not routed to INET/ARCA), thus saving Direct Edge customers routing fees (and making DE more money).

If your ELP members aren't filling orders, then customers pay more to have their orders routed and DE makes less money.

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Re:A High Frequency Trader's Apology, Pt 2 by grandalf on Thursday April 26, 2012 @08:52PM (#3896901)

I think the point about saving DE customers routing fees is the most important one here. If it weren't for DE's advantages (pricing, speed, lower fees) nobody would use it.

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