Re:How the Robots Lost: High-Frequency Trading's Rise and Fall
by phyalow on Thursday June 06, 2013 @06:28PM
(#5835590)
>Where does this money come from?
In theory those posting liquidity will reduce the bid/ask spread, those that are taking liquidity will see a reduction in frictional costs of buying and selling costs. It is the reduction in frictional costs that generates $$$. That and being able to have an edge in whatever orderbook/microstructure you are playing on.
In theory those posting liquidity will reduce the bid/ask spread, those that are taking liquidity will see a reduction in frictional costs of buying and selling costs. It is the reduction in frictional costs that generates $$$. That and being able to have an edge in whatever orderbook/microstructure you are playing on.