The fleecing of retail investors continues as “payment for order flow” expands.
Payment for order flow (PFOF) is not new. Previously, in a less connected world of instantaneous data flows, PFOF was minimal and non-invasive. Today, with high-frequency trading, dark pools, and algorithms running amok, retail traders are fodder for Wall Street profits.
In financial markets, PFOF refers to compensation a broker receives third parties to influence how the broker routes client orders for fulfillment.