The way I think about HFT is: - one effect of an economy is to find an approximate solution to an important problem: optimising resource allocation with regard

The way I think about HFT is: - one effect of an economy is to find an approximate solution to an important problem: optimising resource allocation with regards to growth - within this paradigm, markets exist to process all publicly available information and turn it into real allocation of resources - considering the difference between trades executed once a day vs once a week, the more frequent trades will provide information that is up to date, higher resolution, and will lead to a better solution to the problem - HFT uses a huge volume of very frequent trades based on very weak correlations, meaning that the information it adds is newer than that of longer term trades, is very high resolution, and may take into account factors ignored by longer-term strategies - therefore, HFT leads to better overall resource allocation by providing greater visibility into the value of the things being traded This ties into the comments on the efficient market hypothesis. HFT brings us a little closer to the impossible ideal by making the market a little more efficient.