4 ms·
The rule already exists to ban it... any trade submitted without the intent to actually execute is illegal. HFT is based on creating and with drawing trades con
by rrhyne 13y ago
The rule already exists to ban it... any trade submitted without the intent to actually execute is illegal. HFT is based on creating and with drawing trades continously to discover the best price available. The rule is just not enforced. Regulatory capture is the problem, not lack of regulations.
- 30thElement 13y agoConsidering any low-latency firm worth talking about will be able to afford viewing the full order book (which apparently you can get for $750 a month http://www.nyxdata.com/arcabook http://www.nyxdata.com/arcabook) they don't need to create and withdraw trades constantly. They will however do this on dark pools, as dark pools specifically don't publish the order book. But no common investor will be trading on a dark pool, so this professor wont be able to "cheat" (with as much scare quotes as possible, as AndrewBissel and others discussed) them out of $377k. I don't know the regulations for dark pools so I can't say if this behavior violates them or not, but I'd assume not as dark pools are typically set up to thwart HFT so they'd pounce on any opportunity to keep them out.
- hft_throwaway 13y agoI would be delighted to get filled on every order I send. HFTs usually flicker quotes due to fast changes in their valuation model or software bugs combined with insufficient risk controls. Smart HFTs actually try their best to avoid sending orders. It's incredibly expensive latency-wise compared to leaving your quotes alone and you give up queue position.