How A Nasdaq Algo Destroyed BATS
http://www.zerohedge.com/news/skynet-wars-how-nasdaq-algo-destroyed-bats
http://www.zerohedge.com/news/skynet-wars-how-nasdaq-algo-destroyed-bats
What really happened with BATS execution?
- Thread starter Quickless
- Start date
BATS Market Structure and plan for the IPO was inherently flawed.
If you consider most NYSE Brokers with seats wanted to see it fail, and probably so did NASDAQ Market Makers wanting to get there's, too, it's no wonder it would go to a half cent if their plan after the IPO was to give all of their balance sheet away that had just been raised.
Not only constant selling, but imbalances by Market Structure, the impetus was motivated by abusive short selling, and the fact that BATS publicly announced that the funds of the IPO in their entirety were going to be given away as a one time dividend to older shareholders.
This would grab anybody's attention, because their stock exchange had not been properly tested, but more importantly it was a target by much bigger players that would love to have seen this exchange fail.
Faulty wiring, and a flawed plan of what to do post-ipo lead to this debacle, and I'm personally undettered by the outcomes because I know how to write market structure so that things like this do not happen...at least, not so often that it happens the first day.
If you consider most NYSE Brokers with seats wanted to see it fail, and probably so did NASDAQ Market Makers wanting to get there's, too, it's no wonder it would go to a half cent if their plan after the IPO was to give all of their balance sheet away that had just been raised.
Not only constant selling, but imbalances by Market Structure, the impetus was motivated by abusive short selling, and the fact that BATS publicly announced that the funds of the IPO in their entirety were going to be given away as a one time dividend to older shareholders.
This would grab anybody's attention, because their stock exchange had not been properly tested, but more importantly it was a target by much bigger players that would love to have seen this exchange fail.
Faulty wiring, and a flawed plan of what to do post-ipo lead to this debacle, and I'm personally undettered by the outcomes because I know how to write market structure so that things like this do not happen...at least, not so often that it happens the first day.
Any large order can move price without circuit-breaker logic.
It all depends on the liquidity on the other side.
Someone wanted to sell first, sell at any price, and didnât care which market.
If the market sell order was bigger than all the buy limit orders in all books, then yes.
This is not rocket science.
Edit: Strictly speaking, the last trade would be at whatever the limit price of the last bid consumed was. So not actually 0.