Re:Goldman Sachs is spending $100M to shave milliseconds off...
by bostik on Friday August 02, 2019 @09:38AM
(#20592789)
> There are bots that feign transaction so that others react in a specific way. In the last moment these are canceled again, too late for competitors to still react.
In stock exchanges at least, what you describe is called spoofing. The regulators are not friendly towards it, because spoofing enables to skew price discovery.
It's generally hard to detect and hard to prove, but there have been cases where the regulators have proved sufficiently well that in certain cases, there were orders never intended to be executed. And yes, if you get caught, there are sanctions.
In stock exchanges at least, what you describe is called spoofing. The regulators are not friendly towards it, because spoofing enables to skew price discovery.
It's generally hard to detect and hard to prove, but there have been cases where the regulators have proved sufficiently well that in certain cases, there were orders never intended to be executed. And yes, if you get caught, there are sanctions.
https://en.wikipedia.org/wiki/Spoofing_(finance)