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As others have pointed out, taking a term that has a specific legal definition to relate to an illegal practice and broadening it to cover both legal and illega
by growse 8y ago
As others have pointed out, taking a term that has a specific legal definition to relate to an illegal practice and broadening it to cover both legal and illegal activities doesn't seem like a great idea if your aim is to try and increase people's understanding of the markets. It just adds confusion. This is a shame, as your point about markets not being a level playing field because different participants are able to execute on information in different ways is worth making, especially in the context of new types of exchanges.
An analogy would be to redefine all killings (lawful or otherwise) as "murder". It's not helpful. Words have specific meanings in specific contexts, so lets stop overloading them so much when we don't have to.
- Phillipharryt 8y agoOk well technically front-running is a term used in the industry to specify a type of trading, it's not illegal in itself. However, you can front-run in an illegal way. Like driving a car isn't illegal but you can do it in an illegal manner. The act of front-running becomes illegal when you do it based on insider information, much like the driving becomes illegal when you speed. I hope this clears things up.
- OldManAndTheCpp 8y agoTo be very clear to all readers: front running is illegal. No one in the automated trading industry refers to the non-illegal trading that they do with a reference to illegal trading.
- Phillipharryt 8y agook
- tanderson92 8y agoAs discussed elsewhere in this thread (search my nick), "no one" refers to frontrunning as encompassing both legal and illegal cases except the author of the definitive textbook on market microstructure.
- Phillipharryt 8y agoThank you, I gave up arguing it and was getting massively downvoted for my comments.