Average stock ownership: 22 seconds

Computerized high-speed trading accounts for most trades, experts say.

By Kim Peterson Jan 3, 2011 1:58PM
trader © Comstock/SuperStockWhat, you bought a stock one whole hour ago? And you still own it? That stock is practically a dinosaur in Wall Street's new reality.

The average time a stock is held is 22 seconds. But that's an improvement from a year ago, when it was 20 seconds, according to analyst Michael Hudson, an economics professor at the University of Missouri.

It's all because of computerized split-second trading. "The financial sector is short term," Hudson said in an interview. "They talk as if they're long term."

Wired has an excellent overview of how computerized trading has taken over Wall Street. It's so bad now, in fact, that computers now read news articles at lightning speed, searching for key words that will help them buy stocks. Post continues after video:
"The machines aren't there just to crunch numbers anymore; they're now making the decisions," Wired reports. Computerized high-frequency trading makes up about 70% of all trades, experts say.

How can the individual investor compete with that?

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