High Frequency Trading (Hfts): Reactionary Algorithm

The video tutorial explores high frequency trading (HFT), focusing on the use of complex algorithms that analyze data in real-time to execute rapid trades. It discusses the competitive speed race among trading firms, highlighting the importance of proximity to the New York Stock Exchange. The tutorial also covers reactionary algorithms and predatory techniques like spoofing and quote stuffing, which have been deemed illegal due to their manipulative nature. Despite legal challenges, firms continue to innovate, raising questions about the impact of HFT on market foundations.

Why have certain aggressive trading techniques been deemed illegal?

What implications do high frequency trading algorithms have on the foundational purpose of financial markets?