Hacker News new | ask | show | jobs
by denormalfloat 2512 days ago
Without having read the regulation, why don't institutional investor just make a private market place where they can trade for sub-penny values?
1 comments

Usually it boils down to consolidation of liquidity. For the same reason there are well over 20 ATS venues but only a few are successful, ultimately new venues have difficulty naturally drawing resting order flow.

Market fragmentation aside, adding more price levels to set orders to disaggregates liquidity in the book, usually resulting in lower execution quantity (which increases your overall transaction costs if you’re trying to space trades out).