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Most exchanges have public order books (i.e. available to everyone), so the information you gain with those small orders is also gained by everyone else; that's
by mmaldacker 13y ago
Most exchanges have public order books (i.e. available to everyone), so the information you gain with those small orders is also gained by everyone else; that's not front running.
- crdoconnor 13y ago>the information you gain with those small orders is also gained by everyone else I'm not certain how long before the information is made public (seconds if you pay? minutes if you don't...), but I'm absolutely certain it'd be too late for anybody else to make use of it.
- mmaldacker 13y agoIt's available within microseconds/milliseconds (not including time to travel over the network to wherever you are compared to the exchange's datacentre). It's made available to everyone at the same time (again, if you have a shitty connection, you'll get the information later). You use the exact same system whether you're a bank, investor, broker, hedge fund, ... The only difference is how close you are to the datacentre, how good your networking is, how optimized your trading applications are, which protocol you're using, etc.
- jules 13y agoThe fact that technically, the information may be available at exactly the same time to everybody doesn't make it right (and is it really, or does the guy who initiated it get the info just a bit earlier?). What's happening is that you have a whole industry spinning its wheels to be just a little bit ahead of everybody else. This is a zero sum game. Either the other traders have to build the same kind of extremely fast systems which is just money wasting, or the high frequency traders get to skim off their profit. This is of no benefit to anybody except the high frequency traders, hence why this law was invented.
- yummyfajitas 13y agoEveryone who pays for DMA is on the same multicast feed.