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Some exchanges claim to compete for order flow by executing certain-sized orders at the best quoted markets even if they are not quoting at that level. I have found that this representation is very seldom honored once the specialist on the competing exchange loses a couple of eighths. The offers to compete are only for "uninformed" order flow. If you appear to know what you are doing, the specialists want no part of your business. |
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Enter DAET and especially trading on Nasdaqa system that essentially says "what you see is what you get," and you get it quickly, efficiently, fairly, and honestly. If the stock you see is quoted at a price and you are the first to access that price through DAET, it is yoursno stories, no excusesjust an executed trade and all within a few seconds. The system is impartial, legitimate, and efficient; it allows equal access for everyone and does not discriminate. It prevents market makers from "backing away" (failing to honor their market) and assures legitimate and liquid markets. The obvious result of this phenomenon is guaranteed liquidity for the DAET trader. |
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Today, the DAET trader can instantaneously compete in the Nasdaq market at prices which can improve upon market-maker quotations. These improved prices have the effect of giving the DAET trader a greater advantage of getting an order at a better price and have a dramatic impact on narrowing spreads. |
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Essentially, placing orders through ECNs is turning a formerly dealer-driven market into a customer-order-driven market, which I believe offers a lot of advantages to the DAET trader. |
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DAET traders can operate a business at a very low operational cost either from the offices of a DAET broker-dealer or from the comfort of their home or office, if they have affiliated themselves with a first-class DAET firm. At my firm, for instance, we do not charge rent, bill computer rental costs, or allocate utility expenses to the DAET trader. While remote traders provide their own PC, they may |
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