Flash Boys: A Wall Street Revolt

I know what you’re doing. It’s genius. And there’s nothing we can do about it. But you are only two percent of the market.

Someone out there was using the fact that stock market orders arrived at different times at different exchanges to front-run orders from one market to another.

More meant

And since he puts so much thought into his decisions, he’s capable of explaining those decisions to others.

By inverting its pricing—by paying brokers to execute customers’ trades for which they would normally be charged a fee—the exchange enticed the brokers to send their customers’ orders to the CBSX so that they might be front-run back to New Jersey by high-frequency traders using Spread Networks.

“When I was telling him I’d made nine hundred and ten thousand dollars he about had a fucking heart attack,” said Ronan. “I mean, he doubled over in his chair.” At length his father recovered, then looked up at his son and said, “You know what, Ro, your risks seem to have paid off so far. Why the fuck not?”

Brad knew that he was being front-run—that some other trader was, in effect, noticing his demand for stock on one exchange and buying it on others in anticipation of selling it to him at a higher price.

1987, I happened to be hovering around the fortieth floor of One New York