High Frequency Trading
Hedge Fund Group Against High Frequency Trading Rules
The U.S. hedge-fund industry’s biggest lobbying group urged regulators against cracking down on high-frequency trading, saying new rules would increase costs for all investors and make markets less liquid.
Requiring computerized traders to buy and sell shares during periods of market stress would reduce volume, Stuart Kaswell, general counsel of the Washington-based Managed Funds Association, wrote in a Sept. 12 letter to a panel advising the Securities and Exchange Commission and Commodity Futures Trading Commission. Investors would pay more for stock transactions as a result of the market maker requirement, Kaswell wrote.
“We respectfully urge that you proceed cautiously and introduce changes that are supported by empirical data,” Kaswell said in the letter, which was also sent to SEC Chairman Mary Schapiro and CFTC Chairman Gary Gensler. “Changes not supported by empirical data and directed at preventing rare market dislocations, could further harm investors.” Source