Question

Give the pros and cons of Flash Trading and Dark Pools. How and should the U.S. government regulate them?

Answer 1

dark pools are the customized private exachanges and trading units where securities will be traded in these. the people who are not interested to invest in regular stock exchanges they can invest in these exchanges. dark pools are an ominous-sounding term for private exchanges or forums for trading securities; unlike stock exchanges, dark pools are not accessible by the investing public. also known as “dark pools of liquidity,” they are so named for their complete lack of transparency. dark pools came about primarily to facilitate block trading by institutional investors, who did not wish to impact the markets with their large orders and consequently obtain adverse prices for their trades.

flash orders are those marketable orders sent to a market center that is not quoting the industry's best price or that cannot fill that order in its entirety. the order is then flashed to recipients of the venue's proprietary data feed to see if any of those firms wants to take the other side of the order.

let them have their own organizational body and procedures. the organization will decide the rules and working conditions of the trading centers.