Friday, July 27, 2012

Long-Term Investors Are Getting Screwed By High-Speed Traders


The WSJ reports: Some of the most heavily traded U.S. stocks might also be among the most expensive to trade, costing investors as much as $2.5 billion a year, according to a New York trading and research firm.

Stocks such as Bank of America Corp., Microsoft Corp., Cisco Systems Inc., and Ford Motor Co. are so popular with high-frequency trading firms that long-term investors often have trouble quickly buying and selling the stocks, according to a report by Pragma Securities LLC.

Investors trying to trade cost-effectively often find themselves standing in line behind the fleet-footed traders and are forced to wait to execute…

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