Created from Youtube video: https://www.youtube.com/watch?v=d8BcCLLX4N4videoConcepts covered:high-frequency trading, IEX, 350-microsecond delay, fiber-optic cables, fair pricing
The video explains how high-frequency trading has led to a stalemate in stock exchanges, with companies investing heavily in speed advantages that no longer provide a competitive edge. IEX, a stock exchange, introduces a 350-microsecond delay using coiled fiber-optic cables to level the playing field, ensuring fair pricing by preventing traders from exploiting speed advantages.
How to slow down a stock exchange
Concepts covered:high-frequency trading, IEX, 350-microsecond delay, fiber-optic cables, fair pricing
The video explains how high-frequency trading has led to a stalemate in stock exchanges, with companies investing heavily in speed advantages that no longer provide a competitive edge. IEX, a stock exchange, introduces a 350-microsecond delay using coiled fiber-optic cables to level the playing field, ensuring fair pricing by preventing traders from exploiting speed advantages.
Question 1
High-frequency trading relies on speed for profit.
Question 2
Why is propagation delay important in trading?
Question 3
The IEX exchange filing was considered _____ due to its unique approach.
Question 4
CASE STUDY: A new stock exchange is considering implementing a speed bump similar to IEX's.
What should the new exchange prioritize?
Question 5
Propagation delay affects signal speed in stock exchanges.
Question 6
What is the role of a matching engine?
Question 7
IEX ensures fair pricing by introducing a _____ delay.
Question 8
CASE STUDY: A financial analyst is evaluating the impact of IEX's speed bump on market stability.
What does the speed bump mean for market stability?
Question 9
IEX uses a 350-microsecond delay to ensure fair pricing.
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