So it is probably naive wishful thinking to expect regulators to act intelligent on HFT.
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Yes, a Tobin Tax (or a financial transactions tax, or FTT) would indeed kill HFT.
The problem may be that, unlike marketmakers, HFT investors have no obligation to trade in difficult conditions.
High frequency trading (HFT) is based on proprietary computer models that buy and sell securities without human intervention.
FORBES: Legendary Investors Blame High Frequency Traders For Steep Mkt Declines
At the opening in particular (the left side of the chart) we see the remarkable rise of HFT.
FORBES: HFT comes to dominate markets in five years, in living color
Once much of the opportunity was lost they looked into other markets, spurring the global expansion of HFT.
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While many are still blaming HFT for the flash crash and distorting the markets, Terpstra takes a pragmatic view.
FORBES: Meet The Google For High Frequency Trading Machines: Selerity
If you shun the HFT industry and the revenues of their tech providers, that money is not helping society.
FORBES: High Frequency Traders And Current Market Structures Penalize Investors
He is talking about normal trading latency, not the millisecond or microsecond latency that high frequency traders (HFT) pursue.
But in HFT, as everyone gets faster then those profits get competed away.
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Instead of being better informed about a company, HFT outfits are simply seeing and acting on market prices sooner than competitors.
That is especially important in automated high frequency trading (HFT) where a flawed model can lead to immediate losses, as MathWorks says.
Pragma, an expert in trade execution, has just published a study show how high-frequent trading (HFT) profits come at the expense of ordinary investors.
FORBES: High Frequency Traders And Current Market Structures Penalize Investors
With automation, the US equities market had evolved into a vast complex machine. one that was purposely well-tuned to the nuances of HFT scalping strategies.
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All are discussed in relation to HFT in this ambitious work.
FORBES: The HFT Empire Strikes Back! The Case That Ever Faster Markets are Good for Investors
Dell has developed a speed edge for high frequency traders (HFT).
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Whereas Warren Buffett searches for companies with a sustainable franchise that trade below their intrinsic value, HFT might as well be buying and selling baked beans.
As latency has been driven into the microsecond range for high frequency trading (HFT), firms are looking for either new geographies or new information to supplement market data.
FORBES: Firms Look to Event Driven Trading for Greater Alpha
With friends like the liquidity-providing HFT algorithms, who needs enemies?
These are designed to scare gullible traders into offloading their own shares, at which point the HFT investors withdraw their own spoof trades and snap up the real ones.
We can even make the argument that HFT just made everyone realise that problem faster: and yes, we do want markets to reveal such information as fast as they can.
David Mechner, CEO of Pragma Securities, said this study is significant because it is the first quantitative research to show how HFT profits may come at the expense of investors.
FORBES: High Frequency Traders And Current Market Structures Penalize Investors
Academic researchers are correct they HFT provides valuable liquidity.
FORBES: High Frequency Traders And Current Market Structures Penalize Investors
Instead, I believe that it is a product of high frequency trading and as more traders adopt HFT we will see more firms crashing as they did and see more flash crashes as well.
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Could green issues be the undoing of HFT?
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Fiber and HFT trading technology going dark?
FORBES: High Frequency Traders And Current Market Structures Penalize Investors
Thus, the HFT games-playing is encouraged.
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In their role as market makers, HFT firms make an important role to a healthy market, but certain distortions in the market structure make the profits outsized relevant to the benefits, especially in the liquid end of the market, he said.
FORBES: High Frequency Traders And Current Market Structures Penalize Investors
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