The Wall Street Journal reported previously on a new study revealing that the SEC was providing a special advantage to high frequency traders (HFT) by allowing them to get information filed with the SEC more quickly than most investors. The Journal recently updated its earlier report here, and tells us that although the SEC appears to have reduced that advantage following the publication of this information, it still retains a 2-3 second timing advantage for early recipients of its data.
For those of you interested in the study, which reveals SEC conduct similar to possible similar arrangements in the private sector that the SEC Enforcement Division is investigating as potentially fraudulent securities trading, a copy is available here: How the SEC Helps Speedy Traders, a Columbia Law School Millstein Center for Global Markets and Corporate Ownership paper written by Robert J. Jackson, Jr. and Joshua R. Mitts of the Columbia Law School.
November 10, 2014
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