New York seeks curbs on high-frequency trading

New York's Attorney General has called for curbs on services provided to high-frequency traders. Eric Schneiderman highlighted services that allow traders to get faster access to information.

He said traders can make “rapid and often risk-free trades before the rest of the market can react”. High frequency trading is where firms create sophisticated computer programs to buy and sell stocks in milliseconds, faster than any human. It has grown in popularity in recent years, but it has also come under scrutiny.

“Rather than curbing the worst threats posed by high-frequency traders, our markets are becoming too focused on catering to them,” said Schneiderman.

On Tuesday, Schneiderman raised concerns that firms specialising in high-frequency trading were benefitting from the special services provided by stock exchanges.

He said the services allowed such firm to gain access to key data - including pricing, volume, trade and order confirmation - before other investors, allowing them to take positions in the market accordingly.

- BBC