Tuesday, January 9, 2024

QualityStocksNewsBreaks – Upstream Breaks Mold for Payment for Order Flow, Builds Transparent Trading Environment

 Upstream, the revolutionary retail trading app for stocks and NFTs powered by Horizon Fintex and MERJ Exchange Limited, doesn’t require payment for order flow (“PFOF”). Upstream’s smart-contract-powered market avoids it, an example of the app’s commitment to build a transparent trading environment. According to a recent blog published on Medium, PFOF is a “form of compensation, usually in terms of fractions of a penny per share, that a brokerage firm receives for directing orders for trade execution to a particular market maker or exchange.” The blog explains that investors trading through online brokerage accounts sometimes think they have a direct connection to the securities markets, when actually, orders are often sent to a broker, who then routes that order to a market maker; this third party then decides which public exchange to send the order to. “Market makers need a steady stream of buy and sell orders to fulfill their role as liquidity providers,” the blog explains. “That’s where payment for order flow comes in. Essentially, market makers pay brokers a small fee for directing investor orders their way. This influx of trades increases their order book depth, potentially allowing them to widen the bid-ask spread — which translates to higher profits.” However, PFOF can raise questions about conflict of interest. Upstream opts not to utilize PFOF and breaks the mold by operating with public, on-chain orderbooks, where all bids and offers are shown to users free of charge. In addition, Upsteam’s approach includes real-time trading and settlement, prevents market manipulation, and provides direct access to the market and equitable access to data.

To view the full article, visit https://ibn.fm/VnljR

About Upstream

Upstream, a MERJ exchange market, is a fully regulated global stock exchange. Powered by Horizon Fintex’s proprietary matching-engine technology, the exchange enables investors to trade shares in dual-listed companies, NFTs, shares in IPOs, crowdfunded companies, U.S. and international equities, and celebrity ventures directly from the app. For more information about the company, visit www.Upstream.Exchange.

About QualityStocks

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