Exchange order types prompt fears of HFT conspiracy

High-frequency traders have been viewed with suspicion for some time. Now critics claim exchanges are conspiring with the traders to develop tools that benefit them and disadvantage ordinary investors. Is the threat real? Laurie Carver reports

It is not exactly a dark car park – it’s a swanky hotel not far from St Paul’s Cathedral in London – but the meeting with a senior trader from a New York-based high-frequency trading (HFT) fund feels clandestine, and he insists on anonymity. He lowers his voice, and head, as he says: “When I see some of what goes on, I’m as disgusted as anybody.”

By definition, a lot of what goes on in the HFT space is relatively new, and a host of terms have been coined to describe it in recent years, from