And to take your example a step further, the lower risk of a large mutual fund being unable to offload assets quickly enough could result it allocating more funds to an IPO used to raise funds for a company that actually makes stuff.

The caveats are (i) there are diminishing returns to what trades add in terms of wealth because reducing time and cost of offloading stock a further 15 milliseconds and 0.001% clearly isn't going to radically alter the risks of investing in productive enterprises as reducing the time and cost of selling stock by an hour and 5% was (ii) certain trading behaviours can actually scare real investors away.