Tick size
MarketsDefinition
Minimum price increment a security can trade in. US equities: $0.01 above $1, fractional below. Commission-free retail trading enabled by tighter ticks + payment-for-order-flow.
SEC has periodically debated half-cent tick experiments to reduce trading costs further. Smaller ticks help institutional execution, can hurt retail by reducing sub-penny improvement.
SEC has periodically debated half-cent tick experiments to reduce trading costs further. Smaller ticks help institutional execution, can hurt retail by reducing sub-penny improvement.