Why Is Spoofing Bad?

Re:Why Is Spoofing Bad? by kweinber on Thursday April 23, 2015 @11:47AM (#9427509)

Fees only kick in if you cancel 100x the orders than you actually execute. And then you only pay half a cent per order over that limit.

I was suggesting something much more like a txn fee per order closed above a much tighter threshold (like 3x)

And none of those limits currently apply to registered market makers... And I agree with their exemption from the harsher rule too, but they should bear increased scrutiny and guaranteed liquidity rules for the privilege.

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Re:Why Is Spoofing Bad? by yummyfajitas on Thursday April 23, 2015 @12:01PM (#9427604)

Market makers are obligated to keep lots of orders way outside the NBBO in order to maintain an "orderly market".

If a trade occurs at $10.00 and then the next trade is $12.00, that's considered "not orderly". So a market maker must keep orders at $10.00, $10.20, $10.40, ..., $11.80, $12.00. This way if someone comes in and buys everything then the sequence of trades will be $10.00, $10.20, $10.40, etc.

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