The Single Dollar
A private finance blog focusing on the journey of a 30-anything single woman. Debt, savings, retirement, investing, accountability.
High frequency traders – and even most low frequency” day and week traders – appear at patterns of costs, volumes, and previous trading activity, not signals about firm fundamentals. Their information” consists of some thing else. If you ask them, they say they are acting as marketplace makers,” liquidity providers,” generating money off the bid-ask spread presented to uninformed liquidity traders,” and attempting difficult to remain out of the way of the few traders that do have true fundamental” details. If you ask their critics, they are artfully front-running demand from much less sophisticated investors, removing liquidity” and worsening price impact,” i.e. removing the economic rewards to genuine info trading, worsening French’s public good” problem and simply stealing from informed and liquidity traders.
Now although I have not personally attempted any of …
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