Wall Street Enters Darker Age With Most Stock Trading Now Hidden
Posted: Jan 24, 2025
- Majority of US stock trading now happening outside of public exchanges, at 51.8% in January
- Off-exchange activity includes trading internally at firms or in dark pools
- Increased off-exchange trading could impact pricing and market efficiency
- SEC trying to push more activity back to exchanges with new rules
- Off-exchange trading surge corresponds with increased volume in stocks worth less than $1
- Alternative-trading systems growing, allowing institutional investors to limit information leakage
- About 1.7 billion shares a day changed hands on an ATS in November, up 36% from a year prior
- Larger institutions seem to benefit more from off-exchange trading
- SEC proposes major changes to stock trading, biggest since 2005
- Aim is to improve prices for investors and drive business to traditional exchanges
- Four proposals laid out by SEC Chair Gary Gensler
- Changes would impact order routing, pricing, and broker disclosures
- Plan expected to face industry pushback before finalization
Stay ahead of the market with AI stock alerts & AI summaries of the latest earnings, stock ideas for free with Fluid Bot. Sign up now!