Friday screencast: end of day endgame

• abnormalreturns
• September 10th, 2010

The equity trading environment continues to change right before our very eyes.  A couple of stories today highlight just how much things have changed in the few years.  The first story highlights a group of former specialists who now concentrate their trading at the open and close of the day.  Good work if you can get it.   The second story notes that the CBOE is looking to launch daily options to complement the newly introduced weekly options.

One can argue that these are all inevitable, and potentially useful, market extensions.  However for many the Flash Crash was the first major sign that the market’s structure is badly in need of a fix.  In today’s screencast we wonder just how far the SEC is willing to go to rein in recent developments in equity (and options) trading.

Posts mentioned in the above screencast:

Some traders now only trade the open and the close.  (WSJ, Felix Salmon, Zero Hedge, Dealbreaker)

Here come one-day options.  (Bloomberg, Daily Options Report)

What can be done to slow high-frequency trading?  (FT)

Daily chart of CBOE Holdings (CBOE).  (Finviz)

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