Twitter icon Email alerts icon Latest News RSS icon Magazine icon Stay connected:

View the article online at http://citywire.co.uk/wealth-manager/article/a746340

EU promises crackdown on high frequency trading

by David Campbell on Apr 15, 2014 at 07:47

EU promises crackdown on high frequency trading

European regulators have promised the ‘strictest regulations for high frequency trading in the world’ ahead of the approval of a vote on Markets in Financial Instruments Directive (Mifid) later today.

While the rules have been in development  for years, the issue has been lent impetus by the publication of Flash Boys by Michael Lewis, a comprehensive survey of the sector’s development.

The draft rules, which will go before the European Parliament today, will require algorithms to be tested and monitored by regulators and ensure order increments do not fall below a certain size.  

Rules which would have installed a minimum holding period, making it difficult for trading programmes to operate, were dropped last year, however.

Michael Lewis’ Flash Boys has drawn a spotlight to the hitherto secretive world of high frequency trading, blamed for the lightning speed of the flash crash of 2010.

Lewis claimed that the sector was ripping off small shareholders by exploiting millisecond response times to affect the price investors were able to secure in the market.

leave a comment

Please sign in here or register here to comment. It is free to register and only takes a minute or two.

News sponsored by:

Sponsored Video: Bringing it all back home


As the UK coalition government strives to rebalance the national economy, so called 'reshoring' looks set to play an increasingly important role in economic recovery.

Today's top headlines

Investing for income in a changing environment


With talk on interest rates on the horizon, our latest roundtable debate covers income investing against a changing backdrop

More about this:

What others are saying

Archive

On the road

Click here to find out more from the Audience Development team.

Read more...

Arbuthnot to sell structured products business

by Dylan Lobo on Jul 22, 2014 at 08:05

Sorry, this link is not
quite ready yet