High frequency traders do have an advantage over other investors. They have also invested large sums of money into their equipment and technology.
They also provide a service to the rest of the stock market by providing liquidity to the markets, allowing smaller investors to trade with "spreads" measured in pennies.
They operate in a very similar way that miners work for the network.
Topic: Are high frequency traders rigging stock markets? (Read 1020 times)
damn, son!
Simply put yes, it has been occurring for a while but enough interests and lobbyists in Washington fight not to regulate wall street so nothing will be done about it or slow progressive changes.
zerohedge.com has been talking about this for years!!!
It was only with the recent release of a book by one Michael Lewis that the SEC could no longer sit around watching porn on the taxpayer dime and decided to finally address this.
Seriously go to zerohedge.com and search for HFT. This has been going on for over 6 years at least.
It was only with the recent release of a book by one Michael Lewis that the SEC could no longer sit around watching porn on the taxpayer dime and decided to finally address this.
Seriously go to zerohedge.com and search for HFT. This has been going on for over 6 years at least.
My friend works for an HFT. I can tell you its not risk free unless you are sn arbitrageur. What they do is not that different from market making
thnaks U9, reminds me ...
High Frequency Trading Explained
https://www.youtube.com/watch?v=GAGaReF9LaI
ps-> sadly I cant post exacly youtube inbound cluster pin point locati9on but you got the point...
High Frequency Trading Explained
https://www.youtube.com/watch?v=GAGaReF9LaI
ps-> sadly I cant post exacly youtube inbound cluster pin point locati9on but you got the point...
The Young Turks did a short piece about this at the end of last month: http://www.youtube.com/watch?v=lVgSF8CzSy4.
very good post ... those guys who transladed ed trading strategies to a fpga board, after Packet switching box ... must face scrutining by their peers ...
Are high frequency traders rigging stock markets? Split-second sharks accused of profiting at expense of ordinary investors
The financial world is in uproar over controversial claims that high frequency traders are rigging stock markets.
A cohort of US financial firms are being accused of using speed - an advantage of just a few thousandths of a second - to fleece big money rivals and by extension ordinary savers and investors.
The allegations made in Flash Boys: Cracking the Money Code by Michael Lewis have prompted the US Justice Department to say it is probing high-speed trading for possible insider trading violations. The FBI and US financial watchdogs are also investigating the industry.
The book focuses on Wall Street share trading, but one City insider has commented: 'The same players are in the UK and Europe – if it’s happening in America, it’s happening here too.'
Detractors, spearheaded by Lewis, believe high frequency trading firms are deploying a host of strategies which exploit speed - literally a few milliseconds, less than the blink of an eye - to jump in on share trades and manipulate prices in their own favour.
Lewis alleges that they are 'frontrunning' slower traders by registering that someone wants to buy a stock, acquiring it at a lower price and immediately selling it at a higher one - and because they already know you wish to buy, this transaction is all but riskless.
The staggering speeds now achieved by modern technology mean it is possible to do all this trading faster than a human eye could possibly follow, in a few milliseconds or thousandths of a second. A blink of an eye takes 100 to 400 milliseconds, or thousandths of a second.
http://www.dailymail.co.uk/money/investing/article-2599811/Are-high-frequency-traders-rigging-stock-markets.html
The financial rewards for the HFT middlemen are hard to calculate but in Flash Boys it is suggested that one example of their trades could impose a daily 'tax' on the US stock market of $160million (£96million) on an average daily volume of $225billion (£135billion).
$160million/day in estimated profits?
Should the "free-market" allow this or try to control/stop the practice?
The financial world is in uproar over controversial claims that high frequency traders are rigging stock markets.
A cohort of US financial firms are being accused of using speed - an advantage of just a few thousandths of a second - to fleece big money rivals and by extension ordinary savers and investors.
The allegations made in Flash Boys: Cracking the Money Code by Michael Lewis have prompted the US Justice Department to say it is probing high-speed trading for possible insider trading violations. The FBI and US financial watchdogs are also investigating the industry.
The book focuses on Wall Street share trading, but one City insider has commented: 'The same players are in the UK and Europe – if it’s happening in America, it’s happening here too.'
Detractors, spearheaded by Lewis, believe high frequency trading firms are deploying a host of strategies which exploit speed - literally a few milliseconds, less than the blink of an eye - to jump in on share trades and manipulate prices in their own favour.
Lewis alleges that they are 'frontrunning' slower traders by registering that someone wants to buy a stock, acquiring it at a lower price and immediately selling it at a higher one - and because they already know you wish to buy, this transaction is all but riskless.
The staggering speeds now achieved by modern technology mean it is possible to do all this trading faster than a human eye could possibly follow, in a few milliseconds or thousandths of a second. A blink of an eye takes 100 to 400 milliseconds, or thousandths of a second.
http://www.dailymail.co.uk/money/investing/article-2599811/Are-high-frequency-traders-rigging-stock-markets.html
The financial rewards for the HFT middlemen are hard to calculate but in Flash Boys it is suggested that one example of their trades could impose a daily 'tax' on the US stock market of $160million (£96million) on an average daily volume of $225billion (£135billion).
$160million/day in estimated profits?
Should the "free-market" allow this or try to control/stop the practice?
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