I subscribe to Alan Kohlers Eureka Report and receive the...

I subscribe to Alan Kohlers Eureka Report and receive the Business Spectator through it. Today there is an article about High Frequency Trading, (HFT). The ASX has rented out the room directly behind their servers to six servers, metres away, all with exactly the same length cable so none has a nanosecond edge, and they just sit there and let their algorithms beaver away. The article points out that all they need is just a fraction of a cent, multiplied thousands of times, across many companies, and you're probably talking good steady money. Evidently, the ASX makes big money from the rent, and from the access fees.

Basically this really started since near the end of last year. I used to be able to make a living trading, but since the 1st of the year it's been hard pickings watching this activity stalling everything. Even my beloved Incitec Pivot, a top 50 company is in their sights. I used to be able to pick that stock pretty well and make a monthly wage out of it. Now it's picked apart and floundering for no fundamental reason.

I believe it should be illegal or restrictions put on HFT. Unfortunately, Labor is too incompetent and Liberals are too closely tied to big money, so nothing will get done.

This is my present theory of one of the major contributing factors affecting the IGR SP. BOTs were always there, but now the vast majority of trades are BOTs/HFT.

For those of you actually like to DYOR instead of putting it as a silly post script at the bottom of the post, I think the Business Spectator is free subscription. Here's the link below.

http://www.businessspectator.com.au/bs.nsf/Article/ASX-high-frequency-trading-HFT-markets-NYSE-pd20120411-T8S3V?opendocument&src=idp&emcontent_asx_financial-markets&utm_source=exact&utm_medium=email&utm_content=30477&utm_campaign=kgb&modapt=commentary

It's a very informative article and I find the site to provide a lot of good overall information.