Curbing the Dangers of High-Frequency Trading
The Economists' Voice, Forthcoming
3 Pages Posted: 31 May 2012 Last revised: 20 Jun 2012
Date Written: February 20, 2012
High-frequency trading, as distinct from other forms of algorithmic trading, does not enhance social welfare and can lead to instability. Mandating short, regular trading delays would prevent high-frequency trading while retaining the benefits of algorithmic trading.
Keywords: stock market, stability, regulation
JEL Classification: G18, G24
Suggested Citation: Suggested Citation