Get your free HFT Lobbying Letter Right Here!
In the spirit of the holidays, we wish to donate this letter and template to the public domain. We encourage all business models that cater and rely on high frequency trading to download this letter, free of charge, and send it directly to those in charge of overseeing our markets, in lieu of spending tens of thousands of dollars at DC lobbying firms for essentially the same letter.
Please feel free to take the thousands of dollars in savings, if you choose to, and donate those dollars to any inner city soup kitchen of your choice, thereby truly “doing God’s work”.
A few last points before you address the envelopes:
1) Please make sure the recipients do not examine the assumptions in the studies too closely.
2) Please make sure the recipients do not understand the phrase “conflict of interest”.
3) Please make sure you have no qualms with destroying America.
HFT Lobbying Letter to Senators, Congressmen, the SEC, and CFTC
During the financial crisis of the last few years, our equity markets have performed flawlessly. Investors have been able to buy and sell securities in efficient and low cost ways, even in times of high volatility. Exchanges, Alternative Trading Systems, Market Information Vendors, and Brokers have all made significant expenditures in technology, which has benefitted all investors everywhere by creating stable trading platforms. Costs have never been lower than today. Commissions are the cheapest they have ever been, ensuring easy access for all investors, big and small. Spreads have also never been narrower. This success story of our capital markets is glossed over, ignored, and even suppressed by a frenzied media intent on instilling fear and panic into investors’ minds worldwide, all for the benefit of ratings.
We wish to remind you of these benefits, as there is a politically-motivated movement that wants to add regulations and burdens on the businesses who have kept our markets the envy of the world. While it is commonly accepted that no one really has all the answers to the events of May 6th, there is a rush to judge and enact rules that will have very real unintended consequences. Curbs and regulations on liquidity providers will harm their ability to add liquidity to our markets and keep spreads narrow.
There are countless studies that have been undertaken that demonstrate unequivocally the extremely positive contributions of high frequency trading. Angel, Harris, and Spatt’s Equity Trading in the 21st Century (February 2010), Credit Suisse’s Sizing Up US Equity Microstructure (April 2010), and Brogaard’s High Frequency Trading and its Impact on Market Quality (August 2010) are just a few studies that prove that HFT has narrowed spreads and increased liquidity.
Rather than enact more regulations, we strongly encourage ways to entice the liquidity-providing in high frequency trading even further. Turning back the clock and reversing innovation will do more harm than good, which is why we hope you will undertake the task of better educating our regulating bodies on the benefits of our modern market structure. The success of our capital markets is crucial to the success of our great nation. We trust that you will do what is right for the great people of this great nation, and not enact cumbersome and ill-conceived regulations that will hurt our nation’s progress through these difficult economic times.
We look forward to working with you,
_______________ and _______________