Free Republic

Last spring, Dow Jones launched a new service called Lexicon, which sends real-time financial news to professional investors. This in itself is not surprising. The company behind The Wall Street Journal and Dow Jones Newswires made its name by publishing the kind of news that moves the stock market. But many of the professional investors subscribing to Lexicon aren’t human—they’re algorithms, the lines of code that govern an increasing amount of global trading activity—and they don’t read news the way humans do. They don’t need their information delivered in the form of a story or even in sentences. They just...

WASHINGTON — As a doctoral candidate in physics at Princeton two decades ago, Gregg E. Berman spent a year and a half in a laboratory searching through subatomic data for an elusive particle called the heavy neutrino. Now, from his small office at the Securities and Exchange Commission here, the former physicist is busy completing a similarly painstaking task, supervising a team of more than 20 investigators who have spent the last five months scrutinizing reams of stock-trading data and hundreds of interview transcripts in an effort to figure out why stock prices went into free fall for 20 terrifying...

Federal investigators probing the “flash crash” that briefly sliced nearly 1,000 points off the Dow Thursday are zeroing in on a series of “unusually high-volume” trades in S&P futures that originated in Chicago, a government official told POLITICO. Those trades set off a chain reaction of trades that caused the biggest drop within a single day in the Dow Jones Industrial Average’s storied history.

The Securities and Exchange Commission has promised to ban a controversial trading practice offered by stock exchanges that include Lenexa-based BATS Exchange Inc. Sen. Charles Schumer, D-N.Y., said in a release Tuesday that SEC Chairwoman Mary Schapiro told him in a personal phone call of the regulatory agency’s plans to ban flash trading, which momentarily lets certain traders know of stock orders before they’re released to the public market. BATS and Nasdaq have welcomed scrutiny of the practice. Last month, Schumer sent a letter to the SEC saying that it should ban flash trading or that he would introduce legislation...

Oh my, now the game is afoot! A Nasdaq spokeswoman said the exchange had no comment beyond a letter Greifeld sent to the SEC on Monday, in which he called for the elimination of "any order types or market structure policies that do not contribute to public price formation and market transparency." Greifeld's letter listed "flash orders, internalized orders, enhanced liquidity providers, Block Talk orders, and dark pools," as order types that do not support price formation. But wait.... The New York Democrat, who has urged the U.S. Securities and Exchange Commission to clamp down on the practice, said parent...