What Do Google And The Stock Exchanges Have In Common?
While people may get outraged at Google, there has been no such outrage by investors at stock exchanges who have been tracking their trading data for years. Stock exchanges will consolidate data about their users and redistribute that data. Once an investor enters an order on to an exchange, every keystroke relating to that order is being recorded and packaged into a data feed. This information is much more robust than just quote and trade information and includes information on cancellations and revisions. Stock exchanges will sell or supply consolidated data to high frequency traders who will then model your behavior. At least Google will not sell the data to third parties. In a blog post last July, we asked:
Who owns the data? We can understand the exchange publishing quotes and trades in their direct data feeds because those are visible on most trading systems and are provided by CQS and CTS. But, what about all the other information in these feeds? We think you, the retail and institutional investor, own the data. After all, it is information on your order that is being sold and distributed to high speed traders so they can model your behavior. Exchanges have given you the ability to opt out of certain order id numbers. We think that exchanges should also give you the ability to opt out of their private data feeds altogether. Speak up and demand that you can opt out of these private data feeds.
It’s your data. Protect it.