High-frequency trading, which already has a sullied reputation, is even worse than the critics have charged, a new survey shows.
The Federal Reserve of Chicago recently asked 30 firms associated with the industry — traders, exchanges, vendors and others — to evaluate where HFT stands in the wake of a series of high-profile blowups.
While the central bank's analysts knew there were issues, what they found exceeded their expectations.
Industry pros reported a rash of out-of-control computer algorithms that power the HFT platforms. They admitted that speed is more important than safety. And they even went so far as to say that they actually wish the industry was more regulated but want the rules to be applied equally, something that may not be happening today.
To read the rest of this CNBC article Click On This Link
Congress Shines Spotlight on Speed Trading
Computerized speedtrading something back in the spotlight after a brief dip in the markets for crude oil on monday, is it time for a new regulation ? Direct Link Here
After 20 Years on Wall Street The Machines Are Taking Over, Is It Time To Retire ? Direct Link Here [This is good ;) ]
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Whistleblower : High Frequency Trading (HFT) is Predatory
Wall Street whistleblower Haim Bodek, former head of electronic volatility trading business at UBS, says high frequency trading is disruptive to markets. “It’s actually unbeatable without regulatory change. Direct Link Here
That’s all we need ~ more *regulations*
Money is the barometer of a society’s virtue. When you see that trading is done, not by consent, but by compulsion–when you see that in order to produce, you need to obtain permission from men who produce nothing–when you see that money is flowing to those who deal, not in goods, but in favors
High Frequency Trading (HFT) deeply concerns Erik Hunsader, founder of Nanex. He worries that today's investors, our regulators, -- heck, even the HFT algorithms themselves -- don't fully understand the risks market prices face in the brave new era of bot-dominated trading.
For instance, Hunsader estimates that HFT algorithms are responsible for 70%(!) of all completed transactions on our exchanges, and for 99.9%(!!!) of all exchange quotes.
A very interesting pod cast discussion on the subject of High Frequency Trading.
@Rakesh : Check out by previous blog post right here on FxStreet :
Good or bad it is very likely that HFT is hear to stay. But this does emphasis the importance of using a stop loss on ALL trades.