FLOW
July 30, 2009 by Charlotte
Filed under Finance, In Your Brain
Wall Street “secret dope about companies that swing billion of dollars of stock value in one day.” Is called Flow.
Retail and Institutional investor have been stunned at recent stock market volatility.
The general thinking is that everything is related to the global financial crisis, starting, for the most part, in August 2007, when the Volatility Index, or VIX, started to climb. However, that there are more fundamental reasons behind the explosion in trading volume and the speed at which stock prices and indexes are changing. It has to do with the way electronic trading, the new for-profit exchanges
This has resulted in the proliferation of a new generation of very profitable, high-speed, computerized trading firms and methods that are causing retail and institutional investors to chase artificial prices. These high frequency traders make tiny amounts of money per share, on a huge volume of small trades, taking advantage of the fact that all listed stocks are now available for electronic trading




