SOES bandit

(redirected from SOES Bandits)

SOES Bandit

A trader who uses the Small Order Execution System (SOES) on NASDAQ to manipulate prices. The SOES bandit conducts a small transaction on a security in order to affect the price, and then executes a larger transaction to take advantage of the price inefficiency. This is a form of insider trading, as the broker executing the order knows something about the market's probable movement that other market participants do not know. An SOES bandit is also simply called a bandit.

SOES bandit

A trader who exploits Nasdaq's Small Order Execution System by taking advantage of market inefficiencies. The bandit typically first enters a relatively small order to manipulate a security's price and then quickly enters a second, larger order to take advantage of the new price.
References in periodicals archive ?
And a decade ago, people working the Small Order Execution System, aka SOES bandits, minted money by arbitraging spreads created by lags in the speed at which disparate NASDAQ market makers updated their prices; but the dot-com bust in 2002 eventually laid them low.
CTU was founded in 1995 by Fausto Pugliese, one of the original SOES bandits of the 1990s and one of the first independent traders to take advantage of the Direct Access Trading technology boom.
Later, SOES bandits would be more widely and popularly known as day traders.
Known as the father of SOES bandits, he wrote ``The SOES Bandits' Guide: Day Trading in the 21st Century.
Dubbed SOES bandits, these pioneering day traders were adept at using Nasdaq's Small Order Execution System (SOES) to seize arbitrage profits from the market makers.
On Thursday, Nasdaq again tried to crack down on SOES bandits.