> 30% for matching buy/sell orders? Do you have any idea how insane that is relative to what NYSE charges?
I imagine the pricing is relative to the scarcity and difficult of matching buy/sell orders. Given that NYSE is a national network, that can meet supply and demand instantly between any two individuals in the world, it's substantially different than the much scarcer order-matching reality that a service like Uber would operate in.
TO fulfill an Uber order for a particular interested buyer involves a much smaller set of potential sellers than the NYSE. Thus, it would stand to reason that Uber gets a larger cut than the NYSE. If all Uber did was find a car for your somewhere in the world, that would make it much cheaper. Of course, an uber user is paying to find a car a few minutes away. If NYSE had the additional burden of having to find a physical person near you to exchange stock certificates, you'd expect a higher premium, and indeed, when this paper exchange of certificates was any kind of reality, the NYSE's prices were higher.
Let's say the US introduced a rule that required Uber to route an order to any "venue" with a "better" price. Litigate the details of "better" and "venue" later.
Do you seriously believe that no venue would pop up that yields the driver >70% of the trade price, allowing them to bid lower overall?
This is exactly what the SEC did with Reg NMS and transaction costs declined precipitously.
> This is exactly what the SEC did with Reg NMS and transaction costs declined precipitously.
Citation needed - correlation is not causation. The research on this is mixed and plenty of people argue Reg NMS has increased transaction costs and reduced liquidity. It mostly acts as a subsidy to poorly run exchanges, and indeed the most efficient exchanges and the most liquid markets in some global products are now in Europe.
I imagine the pricing is relative to the scarcity and difficult of matching buy/sell orders. Given that NYSE is a national network, that can meet supply and demand instantly between any two individuals in the world, it's substantially different than the much scarcer order-matching reality that a service like Uber would operate in.
TO fulfill an Uber order for a particular interested buyer involves a much smaller set of potential sellers than the NYSE. Thus, it would stand to reason that Uber gets a larger cut than the NYSE. If all Uber did was find a car for your somewhere in the world, that would make it much cheaper. Of course, an uber user is paying to find a car a few minutes away. If NYSE had the additional burden of having to find a physical person near you to exchange stock certificates, you'd expect a higher premium, and indeed, when this paper exchange of certificates was any kind of reality, the NYSE's prices were higher.