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Read Flash Boys, lots of HFT firms are exploiting the system, and they aren't adding any liquidity. They are using their speed to discover who wants to buy at w
by guiomie 12y ago
Read Flash Boys, lots of HFT firms are exploiting the system, and they aren't adding any liquidity. They are using their speed to discover who wants to buy at what prcice, then they buy stocks faster then the other participant, to then sell it higher to that participant.
- tptacek 12y agoDon't read Flash Boys. Read Dark Pools. Dark Pools is also critical of HFT, but doesn't have the baggage that Flash Boys does. If all you know about HFT comes from Lewis' book, you should be concerned about having the whole picture. In particular: you can come away from Lewis' book believing that the markets prior to electronic trading were reasonable fair, when the reality is the opposite: the trendline of fairness and transparency in the market is sharply positive, and the inflection point of that trendline is the advent of fast electronic trading.