Stock Exchange Hot Potato

Here’s an interesting factoid trend, showing how the “average holding period for a stock” has declined over time. It comes courtesy of Yes! magazine:

In 1945: 4 years

In 2000: 2 months

In 2011: 22 seconds

Quite dramatic, isn’t it? The time between buying a stock and selling is 22 seconds. On average! Which also implies that many such holding periods were much, much less than 22 seconds, and no doubt less than 1 second.

Also without a doubt, computerized program trading is responsible for this acceleration, and the average human investor is left in the dust.

The question becomes, as always : Cui bono?

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