[yummyfajitas]

Front running would be tricky - even if you have Goldman's code, you'll still need to build an infrastructure faster than theirs. Good luck with that.

In contrast, if you can figure out how to implement layering in such a way that their system acts on it, or use price spikes, or something of that nature, you don't need to beat them on speed. You manipulate them, they trade against you as fast as they want to, and you win.

[ig1]

Only if you're talking HFT, most quant trading isn't HFT.

[yummyfajitas]

That is what JSig was discussing, no?

"...somebody who knew how to use this program could use it to manipulate markets in unfair ways," said Assistant U.S. Attorney Joseph Facciponti [in regards to the code taken by Sergey Aleynikov]

(Aleynikov is the guy who allegedly stole code from Goldman.)

[ig1]

Yes the GS code was HFT, but the article is discussing the MS case where there's no indication the code was HFT, the article mistakenly assumes all quant trading code is HFT.