[KPGv2]

One other aspect of HFT that is good for the general investor is that HFT injects liquidity, making it easier for a general investor to liquidate their position, which is a desirable thing for human traders. HFT does not magically make human investors engage in more or less speculative behavior.

HFT is an easy thing to attack, but I've never encountered a lucid argument for why it's bad. "It's not fair that I'm not as fast" isn't really a reason unless you explain why removing liquidity (i.e., making it harder for you to find a buyer at your price point), paired with you moving up the "trading swiftness" rankings, is preferable.

[pnut]

Why do we encourage microsecond scale HFT and tout its virtues, yet shut the market down for the majority of every day?

Why not go all the way and have markets running 24/7/365?

[scrlk]

The NYSE and NASDAQ are planning to move to longer trading hours, 22/5 and 24/5 respectively.

https://www.bloomberg.com/news/articles/2025-03-07/nasdaq-jo... (https://archive.ph/JySaV)

[Ekaros]

And while at that. Remove all circuit breakers. Let the markets be free. Whatever they do. Rocket up or down.

[krapp]

We tried laissez-faire unregulated markets in the 1920s and it didn't go well for anyone but the robber barons.

Maybe you expect to be one of them, but you'll probably just end up in the soup lines with everyone else.

[instig007]

> We tried laissez-faire unregulated markets in the 1920s and it didn't go well for anyone but the robber barons.

yes, let's keep creating too-big-to-fails instead and reward them with bailouts for their mismanagement and borderline criminal misconduct.

[krapp]

>yes, let's keep creating too-big-to-fails instead and reward them with bailouts for their mismanagement and borderline criminal misconduct.

Or maybe we live in a world where nuance exists and there are there are more options on the table than anarchy and oligarchy?

[serf]

the common argument against it is that it guarantees a technological arms race and by those conditions pushes the smaller groups out of the competition.

it's unfair in the same vein that the rich are always offered better loan rates than the poor. Yeah, it's obvious why that would be, but it's not fair either.

although imo pushing small-backer arbitrage out of the equation is a good thing.

[simonh]

What HFT arbitrage does is rapidly push markets with different prices into alignment with each other. If you banned HFT but kept multiple markets, the inevitable result would be markets with bigger differences in prices for longer.

The only kind of trading that really good HFT trading pushes out is other slower less efficient arbitrage traders, but why should we want more worse arbitrage traders if the result is markets being more out of sync?

What's important economically is that traders that trade based on fundamentals can do so efficiently across multiple markets. Efficient HFT arbitrage trading helps that, it doesn't hinder it.

[KPGv2]

> the common argument against it is that it guarantees a technological arms race and by those conditions pushes the smaller groups out of the competition.

But a cursory examination of history would reveal that the literal opposite has happened.