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Comment by asdfologist | Hacker News Reader

You're the one misinformed here. He never said he's against electronic trading. In fact, IEX, the very firm he champions, is an electronic trading firm. He's against he practice of exchanges like BATS getting kickbacks from HFT firms for sending orders to them at inferior prices, screwing over institutional investors in the process.

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The quotes from HFTs are NOT inferior to existing quotes. At worse, they are identical to the best quotes already available on that exchange.

Did you even read the book? The entire point is that some HFTs are given priority fills on orders that no one else has access to, even when the HFT quotes are worse, in return for kickbacks to the exchanges.

Everyone on that exchange has the same access to the same types of orders. HFTs only get priority if someone gives them priority. If these order types are so powerful, why aren't everyone using them?

Also, I will reiterate: HFTs NEVER get fills on quotes that are worse than any other participant on the same exchange. That violates RegNMS, and is straight up illegal.

False - HFT firms have access to special order types. Example is Hide Not Slide, which is mentioned in the book and also here [0].

[0] http://online.wsj.com/news/articles/SB1000087239639044398920...

Why do you believe only HFTs have access to hide not slide? That order type is plainly listed on DirectEdge's website, e.g. https://www.directedge.com/Portals/0/01Trading/Trading%20Pro...

As doktrin said, they were originally concealed.

[citation needed]

When the orders were added, there was a modification to the FIX specification for the exchange. For example: http://www.directedge.com/Portals/0/docs/Direct%20Edge%20Nex.... It is everyone who trades on that exchange's responsibility to stay up to date with what's available, and how it interacts with their trading strategy.

"concealed", in this context, just means "too lazy to carefully read the documentation".

any exchange member may submit a hide-not-slide order. there is nothing secret about them.

They were originally concealed.

> If these order types are so powerful, why aren't everyone using them?

An allegation made in Dark Pools was that the existence of the order types was initially deliberately concealed from most actors in the market. The claim was well substantiated, from what I could tell.

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