I think I have a fairly ok grasp of how the High Frequency Traders made their money, but what I don't understand is when Michael Lewis explains that these guys were taking practically 0 risks - say I wanna place an order for 50000 shares at $5 each from company X. I put my order in, the HFT sees this and races me --> beats me to it --> buys these 50000 shares at $5 to later re-sell them to me at $5.01. Here's what I don't get - I can simply refuse and say "Nah, I don't wanna pay $5.01" - now the HFTs are holding on to shares they can't sell - this seems like a huge risk to me? Why is Michael Lewis explaining in the book that they take 0 risks - what am I missing here?
Submitted September 27, 2017 at 06:11AM by WhoYouWit http://ift.tt/2xLgSTS
