hft; what are the facts?

Interested in creating some discussion here about HFT, in somewhat a different direction to the general media discourse.

I'm interested in providing some education on HFT, as a person who has worked in the space for many years. I'd like to open up for discussion some ideas on resolving the issues. I'm particularly interested in talking about ways that retail traders can avoid being exposed to predatory HFT.

Check out my blog which discusses some aspects of the problem which are under/over-emphasised in Australia, and proposed solutions.

Feel free to ask me any questions about HFT in Australia; one thing you need to be really careful about is applying what is being reported in the US, to Australia. We are no-where near as bad as the US, but the day is but young..

See http://www.filmackay.com/

Please reply to this with any questions regarding HFT. To get things started, here is my position on HFT in Australia:

- Yes HFT is a real scam in US, but in Aus it is only a small fraction of the scale; we need to keep things in perspective.
- The problematic HFT is the really fast ones (less than 10 microsecond), most of it is in fact good for the market.
- Regulatory intervention in the market is bad, the market has the ability to keep the fast HFT in it's place
- Exchanges are key to doing this, but at the moment the market order book rules have created the conditions to breed HFT's power
- There are simple changes that can be made to the order book in order to return the balance to the slower majority. (see TimeMatch on blog above)
- Minimum resting times would harm liquidity creators, and actually help predatory HFT to pick off investors. I don't believe in taxes, quote-to-trade ratios due to unintended consequences.

Feel free to fire any questions through!