The Not-So-Amazing IEX “Flea Circus” Continues…

This week, the President of a National Security Exchange falsely accused his competition based on previously disproven marketing claims packaged as “research.”   To be precise, the exact quote, as published was:  “The exchanges which provide the worst executions pay rebates to brokerage firms for orders. The incentive brings customers into the store but creates a … Continue reading The Not-So-Amazing IEX “Flea Circus” Continues…

IEX continues its self-promotion & anti-rebate rhetoric, despite data telling a different story

As I perused the Curatia news brief earlier this week, I was struck by seeing my article on exchange quote quality followed directly by an article that was essentially an IEX marketing piece.  It was a fascinating juxtaposition;  Readers first saw an article, that summarized billions of quote messages processed in August to show how … Continue reading IEX continues its self-promotion & anti-rebate rhetoric, despite data telling a different story

How Exchanges REALLY Compare: Introducing the ViableMkts Exchange Quality Score, Part 1: Quote Quality

There are significant differences between order book quality and trading characteristics among the nation’s stock exchanges.   Despite this, and the importance of understanding that quality for both investors and issuers, there has been no effort to create standardized metrics before now.  Instead, each exchange relies upon either marketing, direct sales, or the analysis of their … Continue reading How Exchanges REALLY Compare: Introducing the ViableMkts Exchange Quality Score, Part 1: Quote Quality

Crypto-Currency Rhetoric Reflects Conflicts of Interests in the Financial System

There has been a lot of coverage in the press about Bitcoin and other Crypto-Currencies lately, sparked by the decision of the Chinese government to close down exchanges in their country and comments by high-profile financial leaders.  When trying to understand why people say or do things, consider their motives.  For example, while Jamie Dimon’s … Continue reading Crypto-Currency Rhetoric Reflects Conflicts of Interests in the Financial System

China’s Bitcoin Move Should NOT Have Been a Surprise; Why the pundits are wrong, again…

Those that don’t understand the fundamental value proposition of bitcoin and crypto-currencies are out in force today, due to the Chinese decision to shut Bitcoin exchanges.  This is interesting for many reasons, most important of which is that the Chinese move was predictable and, if anything, might make crypto-currencies more valuable in the long run.  … Continue reading China’s Bitcoin Move Should NOT Have Been a Surprise; Why the pundits are wrong, again…

More Thoughts on Flawed Coverage of Passive Investing and ETFs

Maybe active managers are losing assets to passive funds because they refuse to adopt modern technology I find it very difficult to believe how many extremely rich and educated investment professionals continue to repeat paradoxical nonsense about passive investing,  Whether it is Paul Singer complaining about passive investing saying it risks “devouring capitalism” or the … Continue reading More Thoughts on Flawed Coverage of Passive Investing and ETFs

Rebates are Incentives, There is NOTHING “Unfair” About Them…

With Bloomberg coverage of rebate “fairness” sparking renewed conversation of the maker taker “debate” it is an opportune time to clarify the issues.   That article, while it tries to be balanced by calling it a debate approached with “religious zeal” by all parties, is way off the mark.   The “defenders” of rebates use facts and … Continue reading Rebates are Incentives, There is NOTHING “Unfair” About Them…

Payment for Research Thoughts & Remembering August 2007

Note to the SEC on Research for $$s:  Keep it simple Bloomberg reports on the SEC “working on” resolving the conflict between the US policy on paid research and MiFID II.  The US rules require that those who sell research be a registered investment adviser, and the European rules require that investment managers pay for … Continue reading Payment for Research Thoughts & Remembering August 2007

IEX Brings Price Competition and Hype to a Regulatory Function

According to a Reuters article “IEX plans to nab listings from rivals with cheaper, simpler fees.”   The article describes the fledgling exchange’s approach and the reasoning behind their listings push by quoting IEX’s head of listings, Sara Furber.   She described the approach to price competition as “simpler, cheaper fees” and the reasoning for the exchange … Continue reading IEX Brings Price Competition and Hype to a Regulatory Function