Re:How I made $500k with machine learning and high frequency...
by AnIrishDuck on Wednesday November 07, 2012 @11:13AM
(#4753848)
Exactly. HFT reduces counterparty risk for market makers (because with HFT, it's much more likely that there will be a counterparty for any given trade). This enables the market makers to reduce their bid-ask spreads; the profit from the bid-ask spread is what covers the risk a market maker faces from their market clearing obligations.
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