It’s simple though, stop claiming people are breaking the law (front-running) if you want to have a productive discussion. It’s not a “technical detail”, it’s a fundamental property of not being able to beat an order that made it to the exchange before yours.
The reason your concerns are brushed off is because they are nonsensical to anyone who actually understands the market. You’re complaining about extractive behavior but are unable to articulate how it is actually happening and calling it “front running” shows that you definitely have no idea how HFT is making money.
Describe the steps by which you think having something like first look or just faster access to the exchanges allows HFTs to unfairly extract money from normal trades.
There’s an entire book by Michael Lewis that describes these steps. I don’t have enough knowledge to tell you how accurate his description is, and I’d be willing to hear a cogent argument in response. But if you agree that those activities are indeed happening and you’re simply claiming that the abuses he describes are not technically illegal or technically the SEC definition of “front running” then your point is noted and my response is: so what? That’s not a defense against the allegations.
> There’s an entire book by Michael Lewis that describes these steps.
Yes, it was widely derided as a one-sided argument used to support a new exchange (i.e. it was glorified marketing material). It was an entertaining book, but it excluded any realistic view about how “the evil side” works in his narrative.
> then your point is noted and my response is: so what? That’s not a defense against the allegations.
The point is that there are no fucking allegations here. When someone comes out and says, “I don’t like HFTs because they front run orders,” and the reply is “that’s not front running”, what is left to defend? They are being accused of a crime they aren’t committing because people don’t know what the crime is.
It’s like claiming the 7-eleven extorted you into buying a hot dog because they offered a 2 for 1 sale. Then someone points out that isn’t extortion. Then you say “so what? That’s not a defense against the allegations.”
Let’s put this another way. There is a reason that no regulation or arrests came out of flash boys. When you actually look at what HFTs do, there is nothing “unfair” to regular market participants. If you put in an order to sell AAPL at $125, there is no way for them to get ahead of that order in the exchange.
The reason your concerns are brushed off is because they are nonsensical to anyone who actually understands the market. You’re complaining about extractive behavior but are unable to articulate how it is actually happening and calling it “front running” shows that you definitely have no idea how HFT is making money.
Describe the steps by which you think having something like first look or just faster access to the exchanges allows HFTs to unfairly extract money from normal trades.