It’s been shown by many (see Flashboys) that those “benefits” are completely exaggerated and are just an excuse to do HFT. The only real thing HFT benefits the bank accounts of the traders, and the traders will be the first to admit that.
Remember that most retail investor orders never hit the exchange because your brokerage firm is selling the orderflow to a HFT firm.
Overall, you can say the benefit is that spreads are cheaper to cross for investors. But, you could also make the counter-argument that if things became slightly more difficult to buy or sell, this inertia would prevent retail investors from over-trading by taking a long-term view.
> It’s been shown by many (see Flashboys) that those “benefits” are completely exaggerated and are just an excuse to do HFT. The only real thing HFT benefits the bank accounts of the traders, and the traders will be the first to admit that.
"Flashboys" is pretty discredited as a marketing exercise for IEX.
Flash boys is a pretty bad book that contains downright false information. How do you think that you can get free equity trades on RobinHood? HFT massively helps small investors, while (arguably) hurting bigger institutional players.
HFT is "stealing" from the big guys and giving to the little guys.
Flash boys was a great book for the uninitiated but you have to also take it with a grain of salt as it mostly parrots the point of view of those who got screwed by hft — meaning the ones who either disbelieved the possibility, weren’t imaginative / cunning enough to survive or otherwise thought they could shame the system into accepting the former status quo.
