3 ms·
Levine is entitled to his opinion, but I don't think he has argued that retail investors receive better prices compared to a condition where all of their orders
by anonymoushn 4y ago
Levine is entitled to his opinion, but I don't think he has argued that retail investors receive better prices compared to a condition where all of their orders are sent to lit venues and makers who want retail flow have to get it by having top-of-book (or midpoint peg or whatever) orders at lit venues.
- tptacek 4y agoIt's not so much his opinion as the law. Wholesalers have to improve the lit market price, or else route the order to the lit market. And it's clear how they're able to improve that price! The lit market has to serve institutional traders, who are much more expensive to trade against.
- anonymoushn 4y agoThe law obviously does not say anything about price improvement compared to counterfactuals either. Are you saying that if makers' profitability at lit venues was greatly improved, they wouldn't compete to offer tighter spreads at all?