Intruder at the top of the 20 meter amateur band?

Re:Intruder at the top of the 20 meter amateur band? by giantrobot on Monday January 11, 2021 @08:10PM (#25740924)

Not quite, you're forgetting the T in HFT. If everyone was just buying securities a microsecond vs a millisecond might not matter much. What happens is a lot of HFTs act as market makers. They arbitrage positions they create which screws over any non-HFTs. It also moves the price of securities for no reason which affects everyone holding that security. There's also been plenty of cases of HFTs doing front-running and spoofing.

The effects of HFTs aren't limited to HFT vs traditional traders. Their artificial arbitrage affects people's retirement funds and the like. It wouldn't be so bad if they were just making money off other traders but instead they're making money off everyone with money in the markets.

[ Parent | on HN ]

Re:Intruder at the top of the 20 meter amateur band? by zozbot234 on Monday January 11, 2021 @08:16PM (#25740979)

> It also moves the price of securities for no reason which affects everyone holding that security.

Huh? It's narrowing bid-ask spreads, which is beneficial to other market actors. There's nothing "artificial" in it other than betting that the price fundamentals won't move against them, like any other market maker.

[ Parent | on HN ]

Re:Intruder at the top of the 20 meter amateur band? by wglb on Monday January 11, 2021 @10:02PM (#25741721)

> screws over any non-HFT

Not true. The HFTs are often market makers and are PAID to be in the market by the exchanges at all times so that others have something to trade.

[ Parent | on HN ]

Re:Intruder at the top of the 20 meter amateur band? by cma on Wednesday January 13, 2021 @01:08AM (#25758784)

I should clarify I'm referring to pure latency arbitrage stuff and not all HFT.

[ Parent | on HN ]