High-Frequency Traders Seen Profiting at Small-Firm Expense
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High-frequency trading firms earn consistent profits at the expense of smaller and retail participants, according to a study co-authored by the top economist at the U.S. Commodity Futures Trading Commission.
Small firms suffered the biggest losses to high-frequency traders on each contract traded, according to the study co-authored by Andrei Kirilenko, the agency’s chief economist, who is leaving this year. High-frequency traders collectively earned $23 million in trading profits in the E-mini S&P 500 futures contract in August 2010 according to the study posted on the National Bureau of Economic Research website.