Wall Avenue Profits Via Placing Investors Inside The Slow Lane

A lower effective spread is good for investors, since the gap between what buyers pay and what sellers receive is smaller.
Consider data on effective spread, which measures an exchange’s ability to provide trade executions at attractive prices.
In September 2016, IEX’s first full month of operation, the exchange crushed its rivals, offering the best effective spread for 412 of the S.&P.
Since kickbacks result in worse trade execution, brokers that route client orders for kickbacks violate their duty of best execution.
On average, the competing exchanges have effective spreads 96 percent higher than IEX’s for stocks in the S.&P.

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