High frequency trading
SUMMARY: High-frequency traders have been paying to getdirect access to market-moving news releases, a practice that can give firmsthe ability to trade fractions of a second ahead of less fleet-footedinvestors The traders are getting news releases from Business Wire, whichdistributes corporate-earnings releases and economic reports such as thePhiladelphia Federal Reserve’s monthly manufacturing survey and fromMarketwired, a Toronto company that distributes earnings releases and the ADPmonthly employment report
QUESTIONS:
1 Do you think regulators should step in? Why or why not?
2 How can ordinary investors protect themselves againstlosses at the hands of high-frequency traders using this tactic?
