SEC Short-Sale Rule May Cut Confidence, White Cap’s Selway Says. Uptick rule. The uptick rule refers to a trading restriction that disallowed short selling of securities except on an uptick. For the rule to be satisfied, the short must be either at a price above the last traded price of the security, or at the last traded price if that price was higher than the price in the previous trade. The U.S. Securities and Exchange Commission (SEC) defined the rule, and summarized it: "Rule 10a-1(a)(1) provided that, subject to certain exceptions, a listed security may be sold short (A) at a price above the price at which the immediately preceding sale was effected (plus tick), or (B) at the last sale price if it is higher than the last different price (zero-plus tick). Short sales were not permitted on minus ticks or zero-minus ticks, subject to narrow exceptions. "[1] The rule went into effect in 1938 and was removed when Rule 201 Regulation SHO became effective in 2007.
United States[edit] Origin[edit] In 1938, the [U.S. Elimination of the uptick rule[edit] Hong Kong[edit]
HFT/algo Manipulating ETF using SOES. *If there is a huge buyer day in & day out of the SPY whom has no interest in holding for a long period of time, how would this affect individual S&P500 components? The direct affect would cause the cash market(individual stocks, not futures) to trade in a seemingly natural liquid manner in whichever direction the purchaser is leaning. Now for the juicy stuff...For months now i have been watching a specific algorithm push our markets around with great ease.
It looks like this algo is giving the SPY a little "push" through support and resistance levels via massive size executed in seconds. Sometimes the push is tens of thousands of shares sometimes 100's of thousands, the size all depends on the natural volume around the level that may need a "Jump". The algo in question started buying at 110.04 with one block of 999 shares, followed by 60k shares all bought in under two minutes. The 650,000,000,000$ question now is.. Clash Continues on Dark Pools. Rogue Computer Algorithms Threaten Stock Markets | Popular Scien.
Computer intelligence is getting more human every day. They solve problems like humans, they communicate like humans, and now, they're ruining the world's financial markets just like humans. NYSE Euronext, the trans-Atlantic regulatory body that monitors stock trading, has fined Credit Suisse's trading division for failing to monitor a computer trading algorithm that misconducted hundreds of thousands of stock transactions. According to the Financial Times, algorithms handle 60 percent of trading in the equity markets, with little or no human oversight.
The problem is already bad, and getting worse. Earlier this month, a malfunctioning algorithm accidentally traded 200,000 futures contracts to itself. Frederic Ponzo, a managing partner at GreySpark Partners, a consultancy, told the Financial Times that, "it is absolutely possible to bring an exchange to breaking point by having an 'algo' entering into a loop so that by sending them at such a rate the exchange can't cope.
" Front running / Tailgating. Allegations of front running occasionally arise in stock and commodity exchanges, in scandals concerning floor brokers and exchange specialists. Explanation[edit] This example uses unusually large numbers to get the point across. In practice, computer trading splits up large orders into many smaller ones, making front-running more difficult to detect. Moreover, the U.S. Securities and Exchange Commission's 2001 change to pricing stock in pennies, rather than fractions of no less than 1/8 of a dollar, facilitated front running by reducing the extra amount that must be offered to step in front of other orders. By front-running, the broker has put his or her own financial interest above (or in front of) the customer's interest and is thus committing fraud.
Other uses of the term[edit] While front-running is illegal when a broker uses private information about a client's pending order, in principle it is not illegal if it is based on public information. See also[edit] Notes[edit] Goldman Sachs vendait à ses clients des subprimes... dont il se.