How the brokers and the traders swindle us.

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    Posted: 03 July 2012 04:01 PM

    http://www.zerohedge.com/news/dark-pool-truth-about-what-really-goes-stock-market
    The Dark (Pool) Truth About What Really Goes On In The Stock Market

    I knew we were being cheated, but I didn’t know how. This is the best and simplest explanation I’ve seen. As I understand it high volume traders put in silent bids. When a stock gathers momentum these bids processed before the retail bids are. We are forced to “fight the tape.” It’ s not complicated finance, its collusion. The fancy programs are just ways to obscure the collusion to to allow those who feed the brokerages to cut to the front of the line so us little fishies can’t get in or out.

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    Posted: 03 July 2012 04:44 PM #1

    Sorry about the duplicates. I got a message saying could not accept my entry at this time. Probably because I have a nervous overclicky index finger.

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    Posted: 03 July 2012 07:14 PM #2

    A way to mitigate the HFTs is to not play the ultrashort time frame game. Look to a longer horizon and the pennies scalped will not hurt so much.

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  • Posted: 03 July 2012 09:07 PM #3

    If I have been swindled over the past 3.5 years, please get them to continue for a couple of more years.

    thanks in advance

         
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    Posted: 03 July 2012 09:12 PM #4

    I only listen to the Doom Troopers so much.  Even IF the economic world crashed tomorrow - highly unlikely - guess what?

    I’m still ahead, lifetime.  And that’s even if my shares crashed a kajillion percent.  Oh sure, it’d be like I kept my principal in a CD all this time, but it won’t ruin me either.

    ZeroHedge and others would kind of have you believe that you shouldn’t be in the market period.  Good thing I keep my own counsel and take ownership of my own investing/trading mistakes.

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    Posted: 03 July 2012 11:09 PM #5

    If you’ve been lucky enough to find the wisdom on this board, and have some modicum of intelligence and judgment, this is not going to make much of a dent in your portfolio. If you haven’t been so lucky, those “pennies” are not insignificant. More importantly, I think an understanding of the process is helpful in minimizing the damage this can cause.

    I just had that experience trying to buy a long shot spread on the recent 15 point up day and couldn?t get in within the posted bid spread at the time I bid. Ended up paying too much. It was a small trade, but combined with this article a major lesson learned. . From what I can understand, you are much more likely to get cheated during a run up or rundown, so if possible I will place my bets when volatility is low. And if I really want to buy on momentum, I will be willing to pay a bit more in order to assure that my trade is filled before the price skyrockets.

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    The more I learn the higher I go,
        The higher I go the more I see;
    The more I see the less I know,
        The less I know the more I’m free.