Dark Pool

General Discussion
#1

The interview with my friend that owned the Nasdaq market maker firm that he sold to a large bank will happen at some point fairly soon, but his discussion of dark pool activity will be pretty simple. In general, the law and regulations state that dark pool activity MUST be reported and reflected in the consolidated tape (actual market) within a short period of time (hours usually).

If any of you have had discussions with whistle blowers or people willing to speak more openly about what is actually occurring, please talk about it here.

There are a LOT of ppl asking me about this topic through DM’s.

Thanks

Jim

PS: My friend confirmed that, in his opinion, the majority of dark pool activity is done to hide the name of the firm executing the trades as opposed to being done to avoid a large price move AGAINST their position exit or entry. That actually surprised me.

#2

That last point is interesting. Looking forward to the interview.

2 Likes
#3

Jim, how do you feel about 60%+ of AMC trades being routed through dark pools?
A majority of OTC trades are being done by Citadel and and Virtu LLC per finra. Their total shares are almost identical in magnitude and quantity relative to other market makers.
Would this information affect the way you project your model, etc etc ?

1 Like
#4

I don’t know what to believe as far as supposed reporting of all these stats. If I were a bad guy, I would be spreading disinformation and misdirecting ppl as often as possible. Remember that this is a GAME to most of these larger players. It’s no secret that they love chess and poker.

8 Likes
#5

:grinning::gorilla::laughing:. Thanks . sounds fun

#6

But now it’s no longer the human playing chess and poker! it is A.I. and A.I. has a mind (matrix) of its own and will only do what it decides is has to continue to do no?

Similar to war games but with a much more advance futuristic mind!

#7

Does this drastically affect the outlook of the potential upside even with the dark pool activity?

1 Like
#8

Excuse my username I was a sophomore in high school at one point in life

#9

As I understand the working theories now in reddit and other places. The real culprit is not directly dark pools, although an insane amount of volume from meme stocks and retail is being pumped their via payment for order flow.

The real culprit is supposed to be Citadel Connect and any counterparts in other hedge fund market maker divisions. Citadel Connect is an SDP, not a dark pool/ATS. They literally have no oversight.

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#10

I’m surprised how big guys get away by breaking law and stealing money from the poor. Law makers and law keepers do nothing but spill more fud on retail !

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#12

Hey Jim what do u think about the market crashing that’s coming??

#13

So basically, it’s because they want to seem like friend when they are foe because they are kept nameless in the dark pool… But how does it work that so much is sold on open market and only bought in DP with no monitoring or ramifications?

#14

All I forsee is a huge market overhaul during the upcoming crash with all of the new rules being implemented. The corruption will just find another work around in the future market unfortunately.

#15

Yeah, but it’s algorithm and decision capabilities are made by people. It calculates based off of value that a human applies. The only difference is it thinks faster. If we control the speed of the game to slow it down and think about the logical choice, them not make the logical choice, we win.

#16

My concern is PFOF. The DPs being used as a way to keep the PFOF information relevant and to use it to create the illusion of loss or hide information. Plus the delay on orders being executed. I really want to know the time of delay on institutions settling transactions. Are institutions able to delay transactions by minutes, days, weeks? Anyways, great work as always.

1 Like
#17

My understanding is that the dark pools are created to allow people to trade and execute large trades. They are not required to be reported until the trade is completed (could be days). Then they can send them from the New York office to the UK office and delay 24 hours before it being reported. Because they are doing this the normal market does not see any price fluctuation.

#18

Rule of Acquisition No. 190: Hear all, trust nothing.

#19

My opinion is they are doing the large amount of dark pool trades to crush the IV on options while just allowing the selling pressure or short ladder attacks to suppress the price and to scare retail out . It’s that simple

Also think they are parking buy orders for weeks using the dark pools or second book system but who knows really . We own the float and it’s it’s not a if it’s gonna happen but a when it’s gonna happen

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