Another Old-School Financial Market Solution for After the Reset: Go Back to Eighths

(Great suggestion across the transom from a long-time reader.  Who remembers watching the CNBC ticker in the afternoons for the closing stock prices back before the innerwebz?  Remember the eighth and sixteenth quotes?)


You seem to keep a running list of financial market solutions/changes after some economic ‘reset’ (e.g., open outcry, mark to market, etc).  As a former NASDAQ market maker in the 90s, one of my solutions is to go back to increments of 1/8 for equity prices (or 1/16 for sufficiently low price stocks).  This would solve our seeming indifference to being sheared on trades by algos or banks by .05 or .01 or even thousandths of a dollar in some cases.  Being robbed by a more significant amount like an 12.5 cents would certainly make a buyer or seller of stock more likely to notice and resist. 

I look sentimentally back on the 1/8ths.  It was something that made Wall Street unique.  Remember asking what the market was and hearing “1/8 to 3/8, 400 by 200?”  

If you see merit in this small improvement please add it to your list.

God bless from a huge fan,

Polack in NY

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