To all the gurus on the forum…
I am trying to understand exactly how certain brokers, who had preferential access to NSE servers, were making money.
I know that the orders placed by these brokers were filled first. But as far as I am concerned, the speed of execution has never been an issue in trading. What really mattered always whether I was right about the direction of the trade or not.
So, how does it matter if some of these brokers were able to get their orders filled first? If they were wrong about the direction of the trade, wouldn’t they be losing money anyway? For example, if these guys were to place buy orders on Reliance (which has been falling non stop in last 3 days) and their orders were filled first, wouldn’t they still be losing money??
What am I missing here? Did they have access to more information than the rest of us that somehow revealed the direction of the stock movement in advance? What exactly was that information? Level 2/3 data may be??
Any explanation would be greatly appreciated! I am going crazy thinking about this