I’ve asserted a lot of things. Should you believe me? You don’t know that I’m disinterested (though you should damn well know that 300 pages of advertising copy is very, very interested). But I can provide a different perspective; you can’t imagine that anything good is going on, but I can try to widen your imagination.
More broadly and aside from allegations of specific wrongdoing, the claim is that HFT is just shaving the margins of everyone who makes trades more slowly.
The main difference in perspective I want to promote is how you carve up the market. You’re carving it into HFT and Everyone. I say that you should carve it into market makers and investors. HFT makes money. It makes money by shaving the margins off of someone. But why think that it’s shaving “everyone”? It’s competing with market makers and shaving their margins. The market makers are mad about that. That’s enough to explain everything that is observed. Maybe something bad is going on beyond that, but no one says what, no one except liars.
I could say more, but I think it would distract from that one point. (Indeed, I think my prior comments made that mistake.)
I’ve asserted a lot of things. Should you believe me? You don’t know that I’m disinterested (though you should damn well know that 300 pages of advertising copy is very, very interested). But I can provide a different perspective; you can’t imagine that anything good is going on, but I can try to widen your imagination.
The main difference in perspective I want to promote is how you carve up the market. You’re carving it into HFT and Everyone. I say that you should carve it into market makers and investors. HFT makes money. It makes money by shaving the margins off of someone. But why think that it’s shaving “everyone”? It’s competing with market makers and shaving their margins. The market makers are mad about that. That’s enough to explain everything that is observed. Maybe something bad is going on beyond that, but no one says what, no one except liars.
I could say more, but I think it would distract from that one point. (Indeed, I think my prior comments made that mistake.)