5 ms·
Could you elaborate or provide more reference materials on "dumb" flow?
by iaw 11y ago
Could you elaborate or provide more reference materials on "dumb" flow?
- cma 11y agohttp://www.reuters.com/article/2010/12/17/us-markets-dumb-money-idUSTRE6BG2H320101217 http://www.reuters.com/article/2010/12/17/us-markets-dumb-mo... It is basically order flow that often blindly takes liquidity. Traders pay to get it, execute it prop at the best price (though they also can dump straight to the market without taking it prop if it isn't behaving dumb enough). Then they resell the position on the market at a more deliberate pace, providing liquidity (which lets them capture the spread, and lets them earn kickbacks from exchanges that pay for liquidity). Or they match the positions against future dumb flow coming in on the other side.