As was stated last night, not all high-frequency trading is bad. What is being discovered is that there has been in existence an entire business model hidden from the public designed to help the for-profit exchanges perform their sole duty which is "to maintain the best interest of shareholders". We can accept people want to trade fast and frequently, as a trader myself I've been condemned for not holding shares for more than 1 year, I get how it feels. The issue is with the big players, the people who test systems in the open market, and those who use their speed to manipulate the processing power of the slower exchanges through the excessive use of cancelled quotes.
It's been two years since this piece aired on The Daily Show and it hurts to admit it but I once made broad statements about the HFT community unaware that the egregious behavior I was witnessing first hand was the result of many bad apples, not an entire community (think down the lines of the Gun Control debate).
The problem is that I lumped them all together and Irene Aldridge does too but she assumes they're all good. This has been addressed on Floating Path before (with another little bit here). The issue has matured from being about high-speed trading to being about the social networks established as a result of fee-seeking for-profit exchanges.
The problem is that I lumped them all together and Irene Aldridge does too but she assumes they're all good. This has been addressed on Floating Path before (with another little bit here). The issue has matured from being about high-speed trading to being about the social networks established as a result of fee-seeking for-profit exchanges.
Samantha Bee's hits the nail on the head when she says "if I know about a stock activity a day before, it's insider trading but if I know about the activity 1 second before, it's high-frequency trading"?
