The potential for market abuse in dark pool trading is more profound than 'overstated' concerns about the dangers of high frequency trading, says Australia's Securities and Investment Commission (Asic).
The regulator should really be aware how "dark pools " operate and by their failure and slowness to react have allowed the "cheetahs " to mve away from HFT and into these pools .
I cannot believe that someone who makes a price may not be filled when their price trades ............ this cannot be legal !
One would of thought that regulators would have to pass these "pools " or at least give them an "MOT " before they are allowed to trade ?
HFT is a dinosaur compared to the damage "dark pools " will provide to
liquidity and volume .
This is a sensible and mature conclusion from the Aussie regulator. Who would have thought that Australia would bring some common sense to HFT. Dark pools are a different matter and there does need to be increased testing of use and how firms maybe detrimentally
effecting markets. In short none of these issues are new having been with the markets for decades. The regulators need to move with the times and adapt rather than introduce new rules.There are already far too many rules that do more to complicate the market
to the benefit of no one
CompetitiveNew York City, NY, USA
© Finextra Research 2015