The Banking and Strategy Initiative

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HFT playing tricks on ETF stock? and spamming liquidity! | Fund Insight

Though Chi X and the other blackpools that be as well as High Frequency Trading outside Asia are increasing their market shares to atleast 1 in 5 global trades, they are still rushing up a spike or two in rogue trades that have earlier prompted changes in Exchange structure and regulations, but apparently not enough. and no there is absolutely no context to it.

This one, yesterday caught ona Muni Bond ETF, SMB..and though one is still not sure if these are related Mary Schapiro’s plan to slap fees on thousands of trailing orders on each HFT that get canceled at EOD is unlikely to make it to a law,. however convoluted Dodd Frank and Voclker sub rules may have become, you can;t just tell the exchanges where to charge Fees..and these are important custoemrs, who themselves can’t get Sergey Aleynikov convicted for stealing their software.

However ETFs with only money market holdings to emulate the index are sooner than later likely to go awa as even speculative interest is not really present in more than 75% of such ETFs while the few ETFs that get popular have not more than 5-10% money market securities as buffer and the rest from the index or security they are tracking.

HFT strategy lets algorithms publish orders in batches of 10s of 1000s to the exchange at different price levels, buy and sell separated by cents, which brings liquidity to the stock or security but increases chances of chaos and floods spam orders into each such trade.

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