IEX tried this to much fanfare. Turns out most participants don’t particularly care about that as a motivating factor.
You're not wrong to say that most participants don't care about what IEX offers, but enough do to make a meaningful dent in trading volume.
https://www.cboe.com/us/equities/market_statistics/
I don’t know if that is “remarkably well” but it certainly isn’t some market paradigm shift.
If you were to tell me in 10 years the Texas exchange would have 2% of the market I’d believe you. But I’d still not be terribly impressed.
According to their stats, they are usually around 3% of the market:
A fair market could be huge, but the trick is keeping it fair. It used to be more fair, and we used to have a healthier economy because of it.
It’s not like most of the unfairness in the current market couldn’t be dealt with, probably with laws already on the books. Most HFT strategies are not only blatantly dishonest but also clearly illegal. The government looks the other way though, because corruption.
What specific strategies are you referring to? Genuinely curious.
> What specific strategies are you referring to? Genuinely curious.
Any strategy that outperforms his 10-20% passive index fund VTI/QQQ ETF.
HFT is pulling 50-100% annual returns for decades.
HFT is capacity constrained, yes. But anyone would take 100% return every year on “only” $100 million on deployed capital.
My issue as always with these numbers is that back in the day you had some bloke on the floor vacuuming up this wide spreads and today we have some of the smallest spreads in history. It has a cost but that cost is generally less than what you were paying before.