Dark Pools Muddy the Waters

Big institutional players like brokerages, for example, that don't want to disclose their trades prefer to make a market for each other's bids and asks through internal networks known as dark pools. Johnson doesn't know how volume of trades done through dark pools compares with volume on the open market.
"A lot of institutional money is going through these dark pools. With hedge fund activity, dark pool activity has grown significantly," he says. "Hedge funds don't want to reveal trading strategies or holdings. If you're operating through the open market, that information can be pieced together."
No matter how the trades are done, if volatility stays strong as some experts predict, the major exchanges should benefit.