3 ms·
Fair enough, although one can make a reasonable argument that arbitrage is not a value creating activity either, if the market is already reasonably efficient.
by LargeWu 6y ago
Fair enough, although one can make a reasonable argument that arbitrage is not a value creating activity either, if the market is already reasonably efficient.
- Tenoke 6y agoIf the market is reasonably efficient there'd be no room for arbitrage in the first place.
- aabhay 6y agoThat’s why it feels so unequal. The arbitrage doesn’t come from market inefficiency, it comes from regulation/government, ingrained asymmetries, and consumer ‘dumb’ money
- RhodoGSA 6y agoarbitrage comes from walled gardens.
- LargeWu 6y agoRoom to exploit arbitrage does not necessarily imply meaningful market inefficiencies. HFT only works because people with deep pockets can build huge fiber lines directly connected to the stock exchange. It's a model where milliseconds matter in order to trade on differences of fractions of pennies. The market would operate just fine in the absence of HFT operators.