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View Diary: "79% of investors have no trust in the financial system." (154 comments)

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  •  Maybe. At cost of vastly higher volatility and.. (4+ / 0-)
    Recommended by:
    conniptionfit, CFAmick, shaharazade, corvo

    brainless computerized trading 'runs' that threaten to explode the entire system in an instant.

    •  Where is the evidence for higher volatility? (2+ / 0-)
      Recommended by:
      Sparhawk, FG

      If HFT increased volatility, then stocks favored by HST firms should be more volatile than those they don't favor.  I have not seen anything to indicate that they are more volatile - they may even be less volatile.

      The most important way to protect the environment is not to have more than one child.

      by nextstep on Wed Jan 16, 2013 at 08:32:49 AM PST

      [ Parent ]

      •  I guess you haven't seen all the flash crashes (0+ / 0-)

        that have happened simply because of an unexpected 10 to 100 millisecond delay then.  I would call the Down dropping 600 points simply due to panic over an extra 10-100ms considerably increased volatility, wouldn't you?

        You have watched Faux News, now lose 2d10 SAN.

        by Throw The Bums Out on Wed Jan 16, 2013 at 10:50:22 PM PST

        [ Parent ]

        •  Origin of the big flash crash in May 2010 still (0+ / 0-)

          being studied, and some exchange fixes have occurred since then.  The delays you reference are not generally accepted as the cause.

          Looking at what happened recently to Knight and BATS, the damage was largely concentrated into these firms.  

          I am ok with the rule change requiring an order to be outstanding for at least 1 sec before cancelation.

          I don't believe that HFT is the first perfect system ever created by people.

          The most important way to protect the environment is not to have more than one child.

          by nextstep on Thu Jan 17, 2013 at 12:30:56 AM PST

          [ Parent ]

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