September 23, 2009
I believe the proposal to end all flash trading in the equities markets is a step in the right direction of bringing fair trading and good faith back to the individual investors. Individual investors such as myself are already at a disadvantage when entering the markets, trying to disseminate the same amount of information a firm such as Goldman Sachs has almost unlimited resources to do so with. When flash orders are allowed in the markets it can be seen very easily what effect it has on pricing. It allows the firm with that knowledge to direct the amount of movement in price by artificially keeping prices either at a level of sameness or by driving them up or down when those same prices would have been different if no artificial buy and sell orders were made. When those sell and buy orders are just placed then cancelled before the system can react and fill them, it causes either big fluctuations when those orders are filled to one side but will kill that same equity by cancelling trade after trade with no fills. Because of these reasons it is even more vital to stop all flash trading on the options on equities too. The absolute unfair manipulating of ask and bid prices is just unbelieveable. It is atrocious just watching it go on. An equity with $1 increments in strike price can sit unmoving when the stock price goes up $.35-$.50. and the contract month is still more than three months out. Whereas the exact same price moves in the stock a week earlier would send the option value plummeting or skyrocketing. Also when a bid or ask is placed that is either directly in between the current bid ask, common sense and market fairness would or should dictate an immediate fill for the order, that is not what takes place. The clearing firm will make that bid or ask the new high or low offer and the investor is now forced into "chasing" his fill that should have been filled already. Please bring some fairness back to the markets. Ban all flash trading. It is nothing more than legalized price fixing in disguise.