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THE MYTH OF HFT LIQUIDITY !

This week I read a research paper ; endorsed by Mark Spanbroek acting chairman of FIA . The paper states that the order cancellation ratios of  !non HFT firms are  "almost identical " to HFT firms .  It states that as most trading is now "fast" , HFT orders are correct and its cancellation rate non harming either to liquidity or to the market place . These research views are endorsed by the FIA  sadly it appears that they are very much in the HFT  camp !                                                            Being a veteran trader of 30+ years  I must question promoting this paper as I believe it highlights the myth of HFT liquidity and strangely  swerves the phantom liquidity which currently abodes our market place . The recent fines issued to both Euronext Paris and HFT ; Virtu financial ; of 5 million euros each is a key example of fake liquidity . AMF the french regulator also added that  with 0.25 and 0.1 seconds  cancelled orders perhaps they never wanted to trade . Can we really endorse a liquidity trading firm who cancels 96% of their orders ? Under the commodity exchange act  these very orders are no longer wanted or required in our market place  BUT perhaps if the FIA supports HFT "spoofs" we can see why market abuse and other dark acts have grown in our industry   and boosted their profits .   Perhaps it might be better to promote longer holding times of a second or more as speed trading falters and real genuine orders worshipped from afar ? Can we finally attempt to put phantom orders to sleep and treat them as "fill or kill " orders which have zero chance of execution   and does nothing to provide fair and orderly markets . The FIA  have missed an opportunity and sadly not only shown a preference BUT are also wide of the mark !       

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