Broken Markets: How High Frequency Trading and Predatory by Sal L. Arnuk

By Sal L. Arnuk

The markets have advanced at breakneck pace prior to now decade, and alter has sped up dramatically considering the fact that 2007's disastrous regulatory "reforms." An unrelenting specialise in know-how, hyper-short-term buying and selling, pace, and quantity has eclipsed sanity: markets were hijacked by means of high-powered pursuits on the fee of traders and the full capital-raising strategy. A small consortium of avid gamers is making billions via skimming and scalping unaware traders -- and, in so doing, they have remodeled our markets from the world's envy right into a barren wilderness of terror.

 

Since those occasions all started, Themis Trading's Joe Saluzzi and Sal Arnuk have provided an unwavering voice of reasoned dissent. Their small brokerage has stood up opposed to the hijackers in each venue: their day-by-day writings are actually by means of traders, regulators, the media, and "Main highway" traders around the world. Saluzzi and Arnuk do not take prisoners! Now, in Broken Markets, they clarify how all this occurred, who did it, what it skill, and what is coming subsequent. you are going to comprehend the real implications of occasions starting from the crash of 1987 to the "Flash Crash" -- and notice what all of it capacity to you and your destiny. caution: you'll get indignant (if you are not already). yet you will understand precisely why you are indignant, who you are indignant at, and what has to be done!

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Extra resources for Broken Markets: How High Frequency Trading and Predatory Practices on Wall Street are Destroying Investor Confidence and Your Portfolio

Sample text

16. isbn=0132599686. 17. Steve Kroft, “Wall Street: The Speed Traders,” 60 Minutes Oct. id=6945451n. 18. com (May 12, 2011), http://www. html. 3 Web of Chaos Joe Saluzzi was a guest on CNBC’s “Street Signs” segment with Brian Sullivan and Herb Greenberg. It was the afternoon of October 10, 2011. The discussion centered on the volatility caused by high frequency traders and confidence in our stock market structure. “Ninety billion has come out of domestic equity funds since May,” Joe said. “It tells you the confidence is not there....

Why wasn’t there one speed for all investors? Why wasn’t there a speed limit on our financial superhighway? HFT was dragged out into the sunlight. Our papers and that CNBC interview captured the attention of the SEC’s Trading and Markets Division, which invited us to address the entire SEC on-site 36 Broken Markets and bring them up to speed on our views on HFT. We did this in November 2009 and again in June 2010. The SEC’s Round Table on Equity Market Structure—or Sal Goes to Washington On June 2, 2010, Sal went to Washington to participate in the SEC-sponsored Round Table on Equity Market Structure.

The list included the CEOs of several prominent HFT firms, senior executives of exchanges selling products to HFT firms, and senior executives and CEOs of brokerage firms selling sponsored access and “latency consulting” to HFT firms. Ours was the sole voice that would take a contra-stance to Chapter 2 • the Curtain pulled BaCk on high FrequenCy trading 37 the entire pro-HFT “more liquidity, tighter spreads, our-markets-arebetter-than-ever” crowd. Our initial pride and excitement was instantaneously replaced with dread and anxiety over what we should say and do.

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