4 ms·
Why don't we just have turn based trading with turns of 1 or 24 hours and then have a blackout period near turn ends when relevant information should not be div
by shasta 13y ago
Why don't we just have turn based trading with turns of 1 or 24 hours and then have a blackout period near turn ends when relevant information should not be divulged?
- tlrobinson 13y agoIs it possible to enforce such a system? Wouldn't people naturally create and gravitate towards markets where they can trade in real-time?
- bpicolo 13y agoNah, it makes no sense. You could just artificially create transactions and finalize trades every hour anyway.
- shasta 13y agoI don't understand. So you can make side bets in real time with others who choose to do so. The point is that those who choose not to do so don't have to compete on millisecond scale response times to news postings.
- tlrobinson 13y agoMaybe, but I suspect you'd end up with worse prices. It would be hard to enforce a true "blackout period". Traders trade on all kinds of information, not just controlled data. Wouldn't liquidity tend to be lower on a non-realtime exchange, because everyone is essentially trading on outdated information, resulting in worse prices than the realtime exchange? But I know very little about this stuff, so maybe I'm completely wrong.
- shasta 13y agoThe blackout scheme is a very secondary thing. If you make interval 1 hour, then the rapid response advantage only applies to data made available in the seconds before the trading event. Rather than having a millisecond advantage on every trade, the fat pipe guys have a millisecond advantage on every 3.6 millionth trade. I think prices would be better for people not playing the low latency response game. Liquidity within an hour would probably cost a premium as you'd have to get the money from someone on the real time market.
- cynicalkane 13y agoThere's a major exchange in Asia that operates in discrete time, but my Google-fu is failing me right now. Anyone know what it is?
- nexox 13y agoOr data like this could simply be released before the market opens or after it closes, like most quarterly and annual reports.
- kasey_junk 13y agoThere is no such thing as "the market" to time market opens and closes around. For instance the S&P futures contract which is impacted by this is only closed from 4pm-5pm. You can trade equities on several platforms during this time.